Jeff Estok v Issues & Images Group Pty Limited and Others

THIRD RESPONDENT: Gregory James Daniel

FOURTH RESPONDENT: Gregory John Woolley

FIFTH RESPONDENT: David Raymond Coe FILE NUMBER: IRC 7673 of 2001 CORAM: Schmidt J Practice and Procedure - notice of motion seeking summonses for production be set aside - Legal professional privilege - Waiver - Express or implied - Documents sought relevant to issues between parties - Privilege waived - Motion dismissed - Costs as agreed or assessed CATCHWORDS :

LEGISLATION CITED : Industrial Relations Act 1996 Attorney General for the Northern Territory v Maurice (1986) 161 CLR 475 Attorney General for the Northern Territory v Kearney (1985) 158 CLR 500 Commissioner of Australian Federal Police and Anor v Propend Finance Pty Limited and Ors (1996-1997) 188 CLR 501 Crescent Farm (Sidcup) Sports Ltd v Sterling Offices Ltd [1972] 1 Ch 553 CASES CITED : Grant v Downs (1976) 135 CLR 674 Mann v Carnell (1999) 168 ALR 86 Mann v Carnell (1999) 201 CLR 1 Nea Karteria Maritime Co. Ltd. v Atlantic & Great Lakes Steamship Corporation [No 2] [1981] Com L.R. 138 Rodgers v Rodgers (1964) 114 CLR 608 Wigmore on Evidence (McNaughton rev. 1961), vol. VIII, par. 2290 HEARING DATES: 04/09/2002 DATE OF JUDGMENT: 04/16/2002

APPLICANT/RESPONDENT ON MOTION: Mr A Moses of counsel SOLICITORS: Baker & McKenzie LEGAL REPRESENTATIVES: RESPONDENTS/APPLICANTS ON MOTION: Ms E Collins of counsel SOLICITORS: Allens Arthur Robinson

JUDGMENT: - 18 - INDUSTRIAL RELATIONS COMMISSION OF NEW SOUTH WALES IN COURT SESSION CORAM: Schmidt J

Matter Number IRC 7673 of 2001 JEFF ESTOK v ISSUES &IMAGES GROUP PTY LIMITED AND OTHERS Application under section 106 of the Industrial Relations Act 1996

1 This judgment concerns a notice of motion filed by the first and second respondents, seeking that a summons served upon the respondents' solicitor be set aside, as well as aspects of other summonses served upon the first and second respondents.

2 The documents to which the summonses attached were identified and a claim of legal professional privilege was raised in respect of each of them. Other complaints made about the summonses served upon the respondents were largely resolved in discussions between the parties' legal representatives. Other documents sought have been produced without objection.

3 These proceedings were initiated by a summons filed by the applicant in November 2001 pursuant to s106 of the Industrial Relations Act 1996 ('the Act'). The applicant had been employed by the second respondent as Chief Executive Officer for several years prior to the termination of his employment in August 2001.

4 The applicant alleged that part of the agreement reached prior to his employment commencing was that he would receive certain share options. His employment was terminated in August 2001, without payment of the entitlements which flowed to him thereupon under his contract of employment. The letter of appointment provided for 3 months' notice of termination and that "you will be granted an option over the Company's Shares. Further details of this scheme will be provided to you under separate cover". While an executive option plan had been drafted by the respondents and discussed with the applicant, its terms had not been finalised before the termination of his employment. The applicant sought to exercise the share options he asserted he had. The respondents denied that the applicant had the right to do so.

5 The summons sought various relief, going to questions of notice of termination, payment on account of redundancy, superannuation, annual leave, compensation in respect of the process adopted which had led to the termination and in relation to injury to reputation, amongst other matters. Also in dispute between the parties was whether or not the applicant had a right to an option over 2% of the share capital of the second respondent, which the applicant had purported to exercise.

6 After the termination of the applicant's employment, and before these proceedings were instituted, various discussions occurred between the applicant and representatives of the second respondent, as to what payments should be made to the applicant in relation to the termination of his employment and the disputed options. Complaints were advanced in the summons as to alleged unconscionable conduct adopted by the respondents towards the applicant, both in the circumstances of the termination of his employment and in the discussions which followed. There are a number of issues between the parties as to these matters, including issues of fact.

7 One matter about which there was no dispute, was that during the course of one discussion on 31 October between the applicant and Mr Woolley, the fourth respondent, Mr Woolley revealed that the respondents had obtained legal advice about the applicant's rights on termination and in relation to the disputed options. He offered to have the respondents' solicitors confirm their advice to the applicant. The applicant accepted that offer.

8 Mr Woolley instructed Mr Cross, a partner of Allens Arthur Robinson, ('Allens') to communicate with the applicant. Mr Cross prepared an email, which Mr Woolley approved and it was provided to the applicant on 1 November. The email began: 'The purpose of this document is to outline the reasoning which I explained to Greg Woolley as the basis for my conclusion that Mr Estok did not have a good claim for any monetary compensation in respect of the proposed grant of share options.'

9 Amongst other things, the email referred to the termination of Mr Estok's employment, observing that 'The issue is whether this termination results in Mr Estok having a right to recover damages in respect of the "lost opportunity" inherent in the fact that he will not now receive any options'. The email went on to deal with 'ordinary principles of contract law' and the 'more liberal principles of fairness' under the Act, given the timing of the termination of the employment and the float or sale of the second respondent. The email concluded with the view that the Court would not grant the applicant any relief in proceedings such as this, because the applicant had suffered no loss, given that the applicant 'did not at the time possess any material interest or benefit.'

10 The email did not deal directly with the issue of whether or not Mr Estok had been made redundant, although that was taken up in later correspondence. In the summons the reason for the termination was alleged to be a matter relevant to the option claim, reflective of documents considered by the Board of the second respondent as to such options and their exercise in the event of redundancy.

11 Correspondence about the email ensued between the applicant's solicitors, Baker & McKenzie ('Bakers') and Allens. On 9 November, Allens responded to various questions raised by Bakers. It concluded: 'Finally, in relation to the requests set out in paragraphs (a) to (g) of the final page of your letter, I would be happy to consider the provision of certain items of information (subject, of course, to my client's instructions and to the proviso that it not effect a waiver in respect of any other communications between my client and its legal advisers) if there was any prospect that it would assist the parties in understanding the issues in dispute and, perhaps, resolving them. However, at this stage I cannot see that the provision of such information would have that effect, particularly when it is not proposed that you provide similar information in relation to the advice which you have given Mr Estok'.

12 On 23 November, Allens responded further to the questions asked, asserting that the applicant's employment was not terminated on account of redundancy, but for poor performance and stating that: 'We were generally aware of these matters at the time of creating the document on 1 November 2001, a copy of which was forwarded to Mr Estok. That document directs itself toward the operation of section 106 of the Industrial Relations Act 1996 (NSW) and not to ordinary principles of contract law (which would be relevant if Mr Estok had a "vested legal right" to the options). For the reasons sketched out in our note of 1 November 2001, it is our view that the operation of section 106 of the Act does not bestow upon Mr Estok an entitlement to receive any monetary compensation from our client. We note that the analysis contained in your 7 November 2001 fax is based solely on what is said to be Mr Estok's "vested legal right".'

13 A complaint was advanced in the summons initiating these proceedings, as to the applicant's conduct on termination and thereafter. At paragraphs 61 to 71 of the summary of matters of fact and law relied upon, it was alleged that: '61. On 25 October 2001, the Applicant sent a letter to Greg Daniel rejecting compensation for his share options and requesting that his redundancy payment be paid to him the next day. A true copy of this letter is attached and marked " F ".

62. On 25 October 2001 the Applicant also separately wrote to Greg Daniel and notified the Respondents of the exercise of his fully vested share options. A copy of this notice is annexed hereto and marked as " G". The applicant requested that the Second Respondent provide to him a certificate indicating his ownership of the shares, a valuation of the shares for tax purposes, and a letter from the Board guaranteeing the share holding would not be diluted. 63. By 30 October 2001, no termination payment had been made to the Applicant and the Applicant did not receive a share certificate or the other documents which he requested on 25 October 2001.

64. On or about 30 October 2001, the Applicant was telephoned by the personal assistant of Greg Daniel and asked to attend a meeting with Greg Woolley at the boardroom of Monetti. On 31 October 2001 at about 3:00pm, Greg Woolley ("the Fourth Respondent") met with the Applicant at the officers (sic) of Moretti (sic) and told the Applicant that (a) the First and Second Respondents would not issue any options or share to him;

(b) The Second Respondent was not prepared to proceed to an IPO or trade sale in circumstances where the Applicant held 2% of this company's shares;

(c) the Board was prepared to offer the Applicant $150,000 as compensation for (a) above and in return for a Deed of Release from the Applicant;

(d) the Respondent would freeze the Applicant's redundancy payment until this offer was accepted; and

(e) at any rate it was no longer willing to pay six months' redundancy, but was only willing to pay three months' remuneration (which is equivalent to the notice period set out in the Employment Contract). 65. Further at the 31 October meeting, Mr Woolley threatened the Applicant that if he persisted with his claim the Respondents: (a) would withdraw all offers and would not make any termination payments to the Applicant, would not issue the options or shares to the Applicant and would not pay any compensation to him;

(b) would put the matter in the hands of their solicitors who would deny and defend any legal claims pressed by the Applicant;

(c) would ensure that if the matter went to Court, the Applicant would have to pay at least $150,000 in legal fees to pursue his claim;

(d) would consider asserting that the Applicant was summarily dismissed for gross misconduct, so the Applicant would get nothing; and

(e) even if the Applicant was successful in legal proceedings for his entitlements to shares, the Respondents would transfer assets out of the company in which he held shares and use a different corporate vehicle for the IPO or trade sale in order to deprive the Applicant of the benefit of his shares. 66. In relation to (e) above, Greg Woolley said words to the following effect: "As long as there is a leakage of two cents on the dollar to you, here will be no further investment in I&I Holdings. We won't put any more money into I&I. We will simply set up another vehicle to buy companies and then merge them at the time of the IPO or transfer the assets." 67. In the above meeting Greg Woolley also asserted that he had received legal advice from two solicitors to the effect that the Applicant did not have a valid claim for any options. He offered to the Applicant the opportunity of speaking with one of these solicitors later to confirm this advice. The Applicant accepted this offer.

68. The Applicant was given until the end of the meeting to accept the terms that had been put to him. After repeatedly requesting an extension, the Applicant was given until 7pm that evening to accede to the Respondents' terms.

69. At about 5 pm that day Greg Woolley telephoned the Applicant on his mobile phone and left a voicemail message that he had spoken to David Cross, a partner of Allens Arthur Robinson and that David Cross preferred to e-mail him the advice rather than meet with him personally. He also extended the "deadline" until 6pm the next evening so that Greg Woolley could forward the solicitor's advice to him and to enable the Applicant to discuss the advice with his wife.

70. On 1 November, the Applicant received an email from David Cross who the Applicant believed to be a partner at Allens Arthur Robinson. The commencement of the e-mail provided as follows: "The purpose of this e-mail this to outline the reasoning which I explained to Greg Woolley as the basis for my conclusion that Mr Estok did not have a good claim for any monetary compensation in respect of the proposed grant of share options."

71. Mr Cross stated in the e-mail, contrary to all previous representations to the Applicant and the contents of all the draft option plans, that "the issuance, and subsequent exercise of the options was dependant on Mr Estok being employed by I&I at the relevant dates." No mention was made in the email of the fact that the Respondents had terminated the Applicant's employment on the grounds of redundancy or the rights of the Applicant to exercise his options on redundancy.'

14 The summonses for production were in relevantly identical terms. That directed to Allens relevantly sought: (a) All Documents which record instructions from the Respondents or any person on their behalf to David Cross or an other partner or employee of Allens Arthur Robinson in accordance with which David Cross prepared an e-mail dated 1 November 2001 to the Applicant ("The E-Mail") including but not limited to instructions regarding the following matters: (i) the grounds upon which the Applicant's employment with the First or Second Respondent was terminated; (ii) the status of any executive option scheme under which it was proposed by the Respondents that the Applicant would be issued options; (iii) the terms of any such executive option scheme; (iv) the Applicant's entitlement to options and/or shares under the said executive option scheme; and (v) the purpose of the E-mail. (b) All Documents which record instructions from the Respondents or any person on their behalf to David Cross or any other partner or employee of Allens Arthur Robinson in accordance with which David Cross provided the Fourth Respondent with the legal opinion referred to at the outset of the Email, including but not limited to instructions regarding the following matters: (i) the grounds upon which the Applicant's employment with the First or Second Respondent was terminated; (ii) the status of any executive option scheme under which it was proposed by the Respondents that the Applicant would be issued options; (iii) the terms of any such executive option scheme; and (iv) the Applicant's entitlement to options and/or shares under the said executive option scheme. (c) All Documents which record any legal opinion or advice (verbal or otherwise) provided by David Cross or any person on his behalf on or prior to 1 November 2001 to the First, Second, or Fourth Respondents or any person on their behalf relating to any claim or potential claim by the Applicant for options in the Second Respondent or monetary compensation for options upon the termination of the Applicant's employment. (d) All Documents which record any legal opinion or advice (verbal or otherwise) provided by any partner or employee of Allens Arthur Robinson on or prior to 1 November 2001 to the first, Second, or Fourth Respondents or any person on their behalf relating to any claim or potential claim by the Applicant for options in the Second Respondent or monetary compensation for options upon the termination of the Applicant's employment. (e) All Documents (other than caselaw or summaries of caselaw) which David Cross or any persons on his behalf reviewed for the purpose of preparing the Email or the legal opinion to which E-mail relates.'

15 There was no issue between the parties that in the ordinary course, the documents in question were subject to legal professional privilege. The issues to be determined, as put by Ms Collins of counsel appearing for the respondents, were: 1. Had there been any express waiver of that privilege in the email of 1 November and the reasoning upon which it was based? 2. If there had been such waiver, did that constitue, in additon, waiver of the privilege in the source material sought to be produced in the summonses? 3. If there had not been express waiver of such source material, had there been an implied waiver? 4. Issues of relevance also arose, as well as a discretionary consideration going to whether this production was sought, so that the credit of persons who might be called by the respondnets to give evidence in the proceedings might be impugned.

16 The respondents' submissions were that there had been no waiver, express or implied, of the email or the source material in respect of which privilege was claimed. It was also argued that much of what was caught by the summonses was not in any event relevant to the claims advanced by the applicant. It was submitted that there could be no construction by the respondent later that the applicant had been dismissed for poor performance. Whether a redundancy had occurred was a matter of objective fact. Furthermore, the summons itself supported the view that there had been no redundancy as a matter of fact.

17 Mr Moses of counsel for the applicant submitted that there had been voluntary disclosure of the advice and the other material of the nature sought in the summonses on four separate occasions. The first was in the conversation between Mr Woolley and the applicant on 31 October; the second in the email of 2 November; the third in Allens' letter of 9 November and the fourth in Allens' letter of 23 November.

18 It followed that there was no legal professional privilege in the legal advice explained in the email. Nor was there any privilege in the instructions received by Allens as to the purpose of the email or the circumstances of the termination of the employment; any record of conversations between Mr Woolley and Mr Cross about the preparation of the email; the advice from a second independent solicitor which confirmed Allens' advice; or any other advice obtained by the respondents before 31 October regarding the applicant's entitlements, either confirming or contradicting the two solicitor's advice about these matters.

19 It was argued that these conclusions followed from the principles established by the High Court in Attorney General for the Northern Territory v Maurice (1986) 161 CLR 475. Given the circumstances of the waiver and considerations of fairness, the summonses would not be set aside.

20 It was also the applicant's case that the existence and substance of the respondents' legal advice had been revealed to the applicant and relied upon by the respondents who had acted unconscionably towards the applicant in a number of ways. On 31 October the applicant had been threatened that unless the respondents' offer was accepted, they would enter into a sham arrangement so as to deny the applicant's entitlements and to damage him. Complaint about such conduct was advanced in the initiating summons.

21 It was alleged in the summons that the applicant had been made redundant and monetary orders in respect of the redundancy were sought. Redundancy was also relevant to the option claim. It followed, so it was argued, that the whole of the material sought was relevant to a determination of the issues in question. Fairness, in those circumstances, required that partial disclosure of the email, and what it was based upon, not be permitted. The applicant was entitled to the documents on which the advice was based, with an analogy being drawn with an obligation to disclose instructions and material provided to an expert.

22 The risk, which might flow from a disclosure to the applicant of only some of the material, was that it would be taken out of context or its real weight would not be revealed, thereby resulting in injustice. That would not here be permitted. The applicant was entitled to consider and, if necessary, test the instructions given to Allens, which led to the opinion provided to the applicant, as well as what the opinion was otherwise based upon.

23 In reply reference was made to the High Court's decision in Mann v Carnell (1999) 201 CLR 1. It was submitted that here there had been no waiver, either express or implied, of either the legal advice which the respondents had received or the source material, and that fairness would not require the production of that material, which was privileged. It was relevant that the email dealt with the applicant's entitlement to the options, but the material sought also concerned the grounds upon which the applicant's employment was terminated. There had been no waiver in relation to that matter.

24 It was also submitted that there had been no waiver of any other advice given by any other solicitor. The email of 1 November could not amount to a waiver of such other advice. Submissions were advanced as to the approach taken in Maurice and also that of the High Court in Commissioner of Australian Federal Police and Anor v Propend Finance Pty Limited and Ors (1996-1997) 188 CLR 501.

25 One of the matters in issue between the parties in these proceedings is whether or not the respondents made improper threats to the applicant, that they would create a fiction in order to avoid their legal obligations to the applicant under his contract of employment, so as to frustrate proceedings such as these. Those threats were alleged to have been made to the applicant by Mr Woolley during the course of discussions on 31 October as to the payments and options to which the applicant claimed he was entitled upon the termination of his employment, no payments of any kind having been made to him thereupon and his entitlements to the options in question having been denied.

26 While a claim of privilege may be made by a party in respect of parties' communications made upon a 'without prejudice' basis in an attempt to negotiate a settlement of a dispute about which there is litigation on foot or in contemplation, such privilege is not absolute. Here it does not appear that the parties' discussions proceeded on a 'without prejudice' basis. That will not necessarily be fatal (see for example Rodgers v Rodgers (1964) 114 CLR 608 at p614.). Such privilege will, however, obviously not attach to threats of the kind it is alleged were here made. Such threats could hardly be regarded as forming any part of 'bona fide' settlement negotiations. Whether or not such threats were made is an issue which will be determined at the hearing.

27 Similarly, no legal professional privilege exists in relation to communications between a lawyer and a client where the client has the intention of using the advice obtained to commit a crime or a fraud, whether or not that intent was known to the lawyer. The breadth of the expression 'fraud' in this connection was discussed in Crescent Farm (Sidcup) Sports Ltd v Sterling Offices Ltd [1972] 1 Ch 553, where Goff J (as he then was) said at p565 that 'fraud in this connection is not limited to the tort of deceit and includes all forms of fraud and dishonesty such as fraudulent breach of trust, fraudulent conspiracy, trickery and sham contrivances.' These observations were referred to by the High Court in Attorney General for the Northern Territory v Kearney (1985) 158 CLR 500, where this concept was dealt with (see p512 per Gibbs J). At p514 his Honour said that: '…the exception is not confined to cases of crime and fraud, even in the wide sense in which "fraud" has been used in this context, unless the meaning of that word is extended to include anything that might be described as a fraud on justice." (See also Wilson J at pp522-524 and Dawson J pp528-530.)

28 Absence of any legal professional privilege on this basis was however not in issue here. Rather, the contest between the parties concerned whether or not legal professional privilege in relation to the documents in question had been waived by the respondents, either expressly or impliedly, when they took the steps earlier described. The High Court's decision in Propend Finance was concerned with the question of whether legal professional privilege could attach to copies to documents provided for the purpose of obtaining legal advice, when the originals did not attract such privilege. Here, there is no issue that all of the documents in question attract such privilege.

29 Turning then to Allens' advice, on the material here there can be no doubt, in my view, that any privilege in that advice earlier received by the respondents from Allens as to the applicant's entitlements, was waived on 31 October when that advice was revealed to the applicant by Mr Woolley at their meeting.

30 The respondents then instructed Allens to engross the advice they had earlier given and to provide it to the applicant. That occurred on 1 November. In those circumstances, there can be no doubt that there has been express waiver of the privilege otherwise attaching to the advice.

31 The second issue is whether there has been a waiver of privilege in relation to the material on which the advice was based. The conclusion that privilege in that material has not been waived, is not available, in my view, given all of the communications earlier referred to. Such waiver was at the least implied, if not express.

32 In Maurice, these concepts were discussed. There can be no doubt that the advice originally obtained from Allens, as well as the material upon which it was based, which had been provided to Allens by the respondents so that the advice could be given, was privileged. (See Grant v Downs (1976) 135 CLR 674.) Once the advice was communicated to the applicant in the way in which it was, that privilege was lost. Preparation of the email and its communication to the applicant on 1 November, put such waiver beyond doubt (see Maurice per Gibbs CJ at p480 and per Mason and Brennan JJ at p487; Mann v Carnell (1999) 168 ALR 86 at para [36] per the majority). So much was indeed, I think, recognised in Allens' letter of 9 November, earlier quoted.

33 Given what was said in the email and in the later letters, I take the view that similar waiver in relation to the underlying material was also expressly given. The respondents, after all, set out not only to provide to the applicant the legal advice which they had received, but also the reasoning on which it was based. Even if a different view were taken of an express intention thereby to waive privilege in the source materials and instructions, implied waiver must have arisen. The respondents sought to convey to the applicant both the advice and the reasoning on which it was based. Such reasoning can, after all, only have followed from the instructions and material provided by the respondents to Allens, so that the applicant's rights could be considered and then advice as to them could be given.

34 Implied waiver in relation to source documents was discussed in Maurice at pp481-3. Reference was made to the discussion in Wigmore on Evidence (McNaughton rev. 1961) vol. VIII, par. 2290 at p481: 'In deciding it, regard must be had to the double elements that are predicated in every waiver, i.e., not only the element of implied intention, but also the element of fairness and consistency. A privileged person would seldom be found to waive, if his intention not to abandon could alone control the situation. There is always also the objective consideration that when 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. He may elect to withhold or to disclose, but after a certain point his election must remain final.'

35 The test suggested by Mustill J in Nea Karteria Maritime Co. Ltd. v Atlantic & Great Lakes Steamship Corporation [No 2] [1981] Com L.R. 138 at p139 was referred to at p482: '… 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 b to risk injustice through its real weight or meaning being misunderstood.'

36 Gibbs CJ concluded at p483: 'In my opinion … the question is whether the disclosure or use of material that has been made renders it unfair to uphold the privilege in the associated material, and although the question whether the material that has been disclosed in evidence is relevant, it is not decisive.'

37 As earlier noted, in Carnell the High Court also considered such questions of waiver. The fairness test discussed by Gibbs CJ in Maurice was considered by McHugh J at para [100] to [107], but was not referred to in the majority judgment. His Honour observed at para [107]: 'Notions of fairness may be factually relevant in determining whether privilege had been waived in a case like Maurice where there was partial disclosure of privileged material. In such a case, there is a clear potential for unfairness arising out of the capacity of disclosed material - which is part of an undisclosed whole - to mislead by reason of it being removed from its context. If unfairness would arise from partial disclosure, it may be proper to conclude, as a matter of fact, that the person making the disclosure was waiving privilege rather than seeking to obtain an unfair advantage. If the party was obtaining an advantage or furthering his or her interests, it may be proper to conclude that the party waived or should be taken to have waived privilege.'

38 The majority observed in para [29]: 'Waiver may be express or implied. 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" [For example, Goldberg v Ng (1995) 185 CLR 83 at 95; 132 ALR 57]. 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. Thus, in Benecke v National Australia Bank (1993) 35 NSWLR 110, the client was held to have waived privilege by giving evidence, in legal proceedings, concerning her instructions to a barrister in related proceedings, even though she apparently believed she could prevent the barrister from giving the barrister's version of those instructions. She did not subjectively intend to abandon the privilege. She may not even have turned her mind to the question. However, her intentional act was inconsistent with the maintenance of the confidentiality of the communication. 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.'

39 Here, given the course which the respondents elected to pursue, it is difficult to see how their claim that privilege in the source material and instructions upon which the legal advice and its reasoning was based, might now fairly be maintained. That on 9 November, it was said that further information in answer to the questions raised about the advice which had been given would be provided on the basis that " …it not effect a waiver in respect of any other communications between my client and its legal advisers …", cannot alter the course which the respondents had adopted before, nor fairly permit what the respondents now seek to preserve. The approach adopted was inconsistent with privilege in the source material and instructions being maintained.

40 In so far as the material concerned the question of whether or not the applicant had been made redundant, no different view can be taken. The reason for termination was a matter relevant to the question of the applicant's entitlement to options. The material considered by the Board of the second respondent, which on the applicant's case formed a part of his contractual entitlements, itself referred to redundancy. There can be no doubt that the material is relevant to the issues here in question. The conclusion that there was, at the least, an implied waiver in relation to the material and instructions provided to Allens as to the circumstances of the termination and the question of whether redundancy had resulted, cannot be avoided.

41 The summons was also directed to eliciting the second legal advice which, on 31 October, Mr Woolley revealed had been obtained by the respondents. He revealed that it confirmed the advice which Mr Cross had given the respondents, but did not offer to provide it to the applicant. In the circumstances, while obviously more doubtful than the express waiver of Mr Cross' advice, I am inclined to the view that privilege in respect of this advice was also impliedly waived. It was not the mere existence of a second opinion which was revealed, but what the advice in fact was. In those circumstances, on the approach adopted in the High Court authorities earlier referred to, in my view waiver also followed.

42 Mr Moses also referred in his submissions to privilege in any other advice about the applicant's entitlements, obtained by the respondents before 31 October, having been waived. There was no evidence that such other advice had either been obtained by the respondents or disclosed to the applicant. In so far as the summonses seek such advice, it must be concluded that it remains privileged and has not been the subject of any waiver. To that extent only, the summonses must be set aside.

43 For all of these reasons, I take the view that the respondents' motion must be dismissed, subject to the reservation expressed in the preceding paragraph of this judgment. I am not certain that the summonses, as framed, were in fact directed to such other advice. If there be any doubt as to this matter, the parties should within 7 days agree upon the terms of the appropriate order to reflect this judgment.

44 The usual order as to costs would be an order for costs in favour of the applicant, as agreed or assessed. The parties have liberty to approach within 21 days if there is any disagreement about the terms of that order. ------------------------

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