Korea Midland Power Co Ltd v ACIRL Quality Testing Services Pty Ltd

1. I have reached the view there has been a waiver of at least some of the information in the final report, for the following reasons.
2. The 2 April 2020 Announcement commences with statements that its purpose was to provide an update on the outcomes of the investigation (first paragraph) which had been completed (second paragraph). Then the third paragraph expressly states that the McGrathNicol investigations had identified:

(1) evidence that approximately 45 to 50 per cent of the certificates of analysis were amended without justification in the nominated laboratories since ALS's acquisition of the ACIRL business in 2007; and

(2) no evidence of bribery or other third-payments involving ALS staff had been found or indicated.

1. Thus, ALS has deployed (to the extent that the final report contains such information) information in the final report by publishing the above statements to the public at large.
2. That information was deployed at a time when, as Mr Pearson explained, ALS had under contemplation the possibility of: (1) involvement in the Terracom proceeding; and (2) claims from clients or third parties including regulators ([14] above). Of course, the possibility of such a claim has crystallised in the form of the present proceeding.
3. The deployment of such information was for a forensic advantage in seeking to deter prospective claimants from pursuing claims against it and in seeking to assure regulators that there was nothing worthy of investigation. The deployment of that information was also for a commercial advantage, being the maintenance of ALS's commercial reputation including the provision of reassurance to the market as to the (low) materiality of the issues under investigation and that appropriate steps had been taken in response, as Mr Pearson acknowledged.
4. As Gyles J (with whom Tamberlin J agreed) explained in Bennett v Chief Executive Officer of the Australian Customs Service [2004] FCAFC 237; (2004) 140 FCR 101 at 120 [68], it is well-established that for a client to deploy the substance or effect of legal advice for forensic or commercial purposes it is inconsistent with the maintenance of the confidentiality that attracts legal professional privilege. In Cooper v Hobbs [2013] NSWCA 70, McColl JA (with whom Bergin CJ in Eq agreed) observed at [71]:

In Bennett v Chief Executive Officer of the Australian Customs Service [2004] FCAFC 237; (2004) 140 FCR 101 (at [68]), Gyles J (Tamberlin J agreeing) held that it was "... well established that for a client to deploy the substance or effect of legal advice for forensic or commercial purposes is inconsistent with the maintenance of the confidentiality that attracts legal professional privilege". Maxwell P (Bongiorno AJA agreeing) cited Gyles J's proposition in Secretary, Department of Justice v Osland [2007] VSCA 96; (2007) 26 VAR 425 (at [20]) and applied it (at [67]) in rejecting the challenge to the Attorney-General's claim of legal professional privilege in relation to advice he had received on the basis of which he had rejected the respondent's petition for mercy. The plurality in the High Court approved Maxwell P's reasoning: Osland v Secretary, Dept of Justice (at [50]).

1. Thus, there is a clear inconsistency between the publication of the information set out at [71] above and the maintenance of confidentiality over it. That inconsistency gives rise to a waiver.
2. ALS relied upon the decision of Justice Thawley in Duma v Fairfax Media Publications Pty Limited (No 2) [2021] FCA 119. In that case, Horizon Oil Limited made an announcement which revealed some conclusions of an investigation that had been undertaken on its behalf. Justice Thawley upheld a claim for privilege over various documents. On the question of waiver, his Honour said at [33]:

Horizon Oil was not involved in any litigation involving the respondents. Horizon Oil was not seeking to deploy a disclosure of legal advice for any forensic or other advantage that had an adverse impact on the respondents. Horizon Oil made the ASX announcements in circumstances where it owed continuous disclosure obligations. In the face of serious allegations, and recognising its disclosure obligations, and presumably its obligations more generally, Horizon Oil was seeking to indicate to the market that it had taken appropriate steps and received legal advice. Horizon Oil disclosed that it received advice that it had not breached any Australian foreign bribery law. The interests of Horizon Oil and the market to whom this disclosure was made did not relevantly diverge such that it could be said that Horizon Oil's disclosure was inconsistent with maintenance of confidentiality in the legal advice it had received - see: Kenquist Nominees Pty limited v Campbell (No 5) [2018] FCA 853 at [49].

1. This decision does not assist ALS. It cannot be said in the present case that there was no relevant divergence between the interests of ALS and the interests of those to whom the information was disclosed, when the latter group must be taken to include those with potential claims against ALS, and regulators. Further, in the present case, as noted above, the information was deployed for forensic and commercial advantage.
2. Although I am persuaded that there has been a waiver of at least some of the information in the final report, the extent of that waiver is presently unclear. This is a topic upon which the Court would be assisted by further submissions.

1. For the reasons set out above, both the preliminary report and the final report are subject to legal professional privilege, but there has been a waiver of that privilege with respect to parts of the final report. There should be further submissions with respect to the extent of that waiver.

I certify that the preceding eighty-two (82) numbered paragraphs are a true copy of the Reasons for Judgment of the Honourable Justice Goodman.

NOBLE RESOURCES INTERNATIONAL AUSTRALIA PTY LTD (ACN 151 836 252)

ACIRL QUALITY TESTING SERVICES PTY LTD

(ACN 003 451 876)

NOBLE RESOURCES INTERNATIONAL AUSTRALIA PTY LTD (ACN 151 836 252)

ACIRL QUALITY TESTING SERVICES PTY LTD

(ACN 003 451 876)

NOBLE RESOURCES INTERNATIONAL AUSTRALIA PTY LTD (ACN 151 836 252)