Plaintiffs in S CI 2010 02882 v Defendants in S CI 2010 02882

Supreme Court of Victoria|2012-06-20|Before: SIFRIS J

EVIDENCE - PRIVILEGE - joint privilege - material disclosed subject to joint privilege - whether jointly privileged material able to be tendered in inter partes proceedings - whether privilege waived or lost - question determined prior to trial - Evidence Act 2008 (VIC) ss 124 and 131A - whether proceedings relate to same matter as material - whether joint privilege arose out of joint retainer - loss of joint privilege at common law when parties in litigation - whether joint privilege able to be lost through party possessing material - Calcraft v Guest [1898] 1 QB 759.

Mr G Bigmore, one of Her Majesty's Counsel, with Ms S McNicol

Mr M Derham, one of Her Majesty's Counsel, with Mr A Dinelli

For the Liquidators (except the liquidators of the Seventh Defendant)

1 Proceeding 10/02882 is one of sixteen separate Group Proceedings brought in this Court, pursuant to Part IVA of the Supreme Court Act 1986, relating to managed investment schemes formerly operated by the Great Southern group of companies ("the Clarke Proceeding").

2 Each of the sixteen group proceedings relates to a distinct Product Disclosure Statement ("PDS") issued in respect of one or more Great Southern managed investment schemes. The plaintiffs were investors in the relevant managed investment schemes. They claim that relief flows from deficiencies in those PDSs, and associated conduct (principally non-disclosure) by or on behalf of various defendants.

3 The "responsible entity" ("RE") under the Corporations Act 2001 (Cth) ("Corporations Act") of each of the managed investment schemes was Great Southern Managers Australia Limited ("GSMAL"). The financing arm of the Great Southern group was a company called Great Southern Finance Pty Ltd ("GSF").

4 While GSMAL was RE of the schemes, it and its officers (including the liquidators) owed duties pursuant to ss 601FC and 601FD of the Corporations Act to the scheme members - i.e. (among others) the plaintiffs. The members are also creditors of GSMAL because they have provable claims for damages for breaches of those duties including failing to operate the schemes to completion.

5 Each of GSMAL and GSF and other companies have, since November 2009, been in liquidation.

6 The main proceedings in these matters are being heard by Justice Croft. During a directions hearing on 27 April 2012, the parties requested his Honour to refer the question of whether a claim for privilege could be maintained in relation to certain documents, namely the 2005 and 2006 Board Papers, to another judge for determination. The "matter" was referred to avoid his Honour being placed in the difficult position of reviewing potentially privileged material that is to be tendered at trial. Though the trial is not scheduled to commence until 17 September 2012, it was thought desirable to resolve the issue of privilege over these documents at this earlier point to avoid any delay in the main proceedings. The parties endeavoured to formulate a question for my determination. However, I indicated that this was not necessary as the matter referred was obvious enough.

7 I heard submissions from the parties on 29 May 2012. In addition to determining the specific issue regarding privilege over the two board papers, the plaintiffs also filed an originating process, returnable before me on the same day, appealing, under s 1321 of the Corporations Act, the decision of the liquidators to maintain a claim for privilege over the board papers ("the Originating Process").

8 The 2005 Board Paper was originally produced upon subpoena to the Court by Peter John Patrikeos ("Patrikeos") and Jeffrey Arthur Sydney Mews ("Mews"). Patrikeos and Mews were directors of GSMAL. They were originally defendants in proceeding 10/02882 but the claim against them was discontinued and they are now third parties to that proceeding.

9 The unredacted 2005 Board Paper was uplifted from the Court by the plaintiffs following the liquidators determining that:

(b) the privilege was held jointly as between GSMAL and other members of the Great Southern group of companies, on the one hand, and the plaintiffs, on the other.

10 Prior to their uplifting of the document, the plaintiffs had communicated to the liquidators their view that they enjoyed joint privilege in advice provided to GSMAL or related companies "in connection with the management or administration of the relevant [managed investment] schemes".

11 Prior to their uplifting of the 2005 Board Paper the plaintiffs did not know that the document was a document in which group members enjoyed a joint privilege - the plaintiffs did not have access to the document at the time and its redacted version previously given to the plaintiffs was inconclusive.

12 The unredacted 2005 Board Paper has also been discovered by GSMAL.

13 It is now apparent that the May 2005 emails from Mr Pascoe, set out in full in the 2005 Board Paper, contained legal advice tendered to GSMAL as principal client. According to the affidavit of Ms Karen Fleischer, formerly in-house solicitor of Great Southern Limited, sworn 16 May 2012 (the "Fleischer Affidavit"), that advice from Mr Pascoe was sought and obtained on behalf of GSMAL for the benefit of scheme members, including members of the 2005 Plantation Scheme (one of the schemes with which class action proceeding 10/02882 is concerned).

14 The 2006 Board Paper was discovered by the liquidators, and a redacted version was made available to the plaintiffs on or about 23 April 2012. It was first inspected by the plaintiffs on 14 May 2012. The plaintiffs claim that they are entitled to an unredacted version.

15 The plaintiffs have indicated that they intend to tender unredacted versions of the 2005 Board Paper and presumably the 2006 Board Paper at the trial of the proceeding, which, as pointed out, is fixed for hearing later this year. GSMAL have indicated that they will object to the tender on the grounds of joint privilege.

16 In order to provide a further basis for their intended course of action in relation to the Board Papers the plaintiffs commenced the Originating Process in proceeding 12/02658. Without commenting on the suitability or desirability of such course I heard the application effectively on its merits.

17 The plaintiffs contend that joint privilege in the 2005 Board Paper has been lost and that the document can be tendered in evidence by them. They propose to tender it.

18 There are three alternate submissions put by the plaintiffs in this regard which they contend support their position.

19 First, the plaintiffs contend that they enjoy a joint privilege with GSMAL as RE by virtue of the relationship of beneficiary (the plaintiffs) and trustee (GSMAL) and as such are entitled to the 2005 Board Paper as joint privilege holders. This much has been conceded by GSMAL. However, by commencing proceeding against GSMAL and GSF[1] the plaintiffs contend that the joint privilege is now lost by virtue of s 124 of the Evidence Act 2008 (Vic) ("Evidence Act") ("The s 124 Submission").

20 Second, and irrespective of the first submission, the plaintiffs contend that the privilege, if any, in the 2005 Board Paper no longer exists because the plaintiffs already have an unredacted version in their possession. This submission relies squarely on the long line of common law authorities to the effect that the availability of a claim for privilege is lost once a privileged document passes into the possession of another who might then tender it in evidence ("The Calcraft v Guest Submission").[2]

21 Third, even if the privilege exists in the 2005 Board Paper and has not been lost, the plaintiffs contend that it is not open to the liquidators (the defendants in proceeding 12/02658) to assert the privilege and object to the tender of the board papers. This is because the liquidators can only assert privilege if they form the view, in good faith, that to do so is, or may be, in the interests of creditors or of the company.[3] The plaintiffs contend that it is not in the interests of the creditors or the company for the liquidators to claim privilege in this case. Hence the plaintiffs' appeal from the decision of the liquidators and the originating process in which the plaintiffs seek to "reverse" that decision under s 1321(1)(d) of the Corporations Act ("The Appeal Submission").

I Loss of Joint Privilege - the s 124 Submission

22 The plaintiffs contend that privilege is now lost by virtue of the application of s 124 of the Evidence Act.

23 Section 124 provides:

"124 Loss of client legal privilege - joint clients

(1) This section only applies to a civil proceeding in connection with which 2 or more parties have, before the commencement of the proceeding, jointly retained a lawyer in relation to the same matter.

(2) This Division does not prevent one of those parties from adducing evidence of

(a) a communication made by any one of them to the lawyer; or

(b) the contents of a confidential document prepared by or at the direction or request of any one of them -

24 The plaintiffs submitted that s 124 is intended to apply to the situation where one joint privilege holder is taking legal proceedings against another joint privilege holder. It allows the former to use (that is, adduce and tender) the joint privileged advice and communications against the latter.[4] If there are no proceedings inter se the waiver or loss of the privileged communications cannot occur without the consent of both or all of the privilege holders.[5]

25 It was submitted that the intention behind s 124 is to allow for the loss of privilege where there is subsequent litigation between the privilege holders. Otherwise, the general rule would mean that one privilege holder could:

"prevent the other, by making a client legal privilege claim from leading evidence of relevant evidence (for example, a false or misleading statement made by one of them during a conference with a lawyer)."[6]

26 According to the plaintiffs the classic example of s 124(2) is where joint venturers consult a solicitor about a joint venture and they later "fall out" and commence litigation about the joint venture.[7]

27 The plaintiffs referred to In Re Nika Management Services Pty Ltd (in liq)[8] where Cohen J held that if there are proceedings between persons having a joint privilege, than neither can claim the privilege against the other. Cohen J cited McCormick on Evidence which states:

"But it will often happen that the two original clients will fall out between themselves and become engaged in a controversy in which the communications at their joint consultation with the lawyer may be vitally material. In such a controversy it is clear that the privilege is inapplicable."[9]

28 Hence it was submitted that the very nature of these proceedings, namely where one joint privilege holder (the plaintiffs/investors) has commenced proceedings against another joint privilege holder (GSMAL), indicates that any joint privilege in advice and communications must be lost by virtue of s 124.

29 GSMAL contended that s 124 does not apply at this stage of proceedings, but that if it did there was no joint retainer and that if there was a joint retainer it was not in relation to the same matter that these proceedings are concerned with. Finally it was contended that because the proceeding included other parties not entitled to the joint privilege s 124 did not apply to destroy any joint privilege.

30 GSMAL contends that s 124 is only relevant because s 131A, dealing with preliminary proceedings relating to disclosure, requires any objection to disclosure to be dealt with as if the objection related to the adducing of evidence. The submission proceeded on the basis that because s 131A was not relevant s 124 was not attracted at this stage.

31 Section 131A provides:

"131A Application of Part to preliminary proceedings of courts

(a) a person is required by a disclosure requirement to give information, or to produce a document, which would result in the disclosure of a communication, a document or its contents or other information of a kind referred to in Division 1 or 3; and

(b) the person objects to giving that information or providing that document -

the court must determine the objection by applying the provisions of this Part (other than sections 123 and 128) with any necessary modifications as if the objection to giving information or producing the document were an objection to the giving or adducing of evidence.

(2) In this section, disclosure requirement means a process or order of a court that requires the disclosure of information or a document and includes the following -

(a) a summons or subpoena to produce documents or give evidence;

(f) a request to produce a document under Division 1 of Part 4.6;

32 GSMAL contends that s 131A does not apply because either -

(a) the pre-condition for the operation of the section in s 131A(1)(b) (namely, the person - GSMAL - objects to providing the document to the plaintiffs) is not satisfied as GSMAL does not object to producing the 2005 Board Paper to the plaintiffs, or for that matter to any other person who establishes an entitlement as a joint holder of the privilege. It is common ground that GSMAL has already produced the unredacted 2005 Board Paper, and thus the privileged material, to the plaintiffs; or

(b) the modification purportedly effected by s 131A does not work when applied to s 124, and the latter section can only operate in accordance with its terms and intent in the circumstances of adducing evidence at trial. This is because at all stages up to the time of a party seeking to adduce the privileged document into evidence, the joint holders are entitled, as between themselves, to have the document produced to them, that is, to inspect it.

33 GSMAL submitted further that the joint privilege must emanate from the joint retainer of the lawyer in relation to the same matter that was the subject of proceedings.

34 GSMAL contended that given the benefit of the joint privilege (by operation of law) it would be necessary to construe the words "jointly retained a lawyer in relation to the same matter" as embracing a much wider category of circumstances, such that the result of a retainer, being communications the subject of joint privilege (whether the product of a retainer jointly or, as here, by one only of the ultimate joint holders of the privilege), is the intended ambit of the section. It was submitted that the words do not support such a construction.

35 In relation to the 'same matter' requirement, GSMAL contended that the advices related to the construction of the 1994 Land Management Agreement and related matters whereas the matter that is the subject of the Clarke Proceeding is the PDSs issued by GSMAL in respect of the 2005 and 2006 plantation schemes, and the other proceedings relate to the PDSs issued in relation to later schemes. Thus, it was contended that these are different 'matters' from the subject of the advices.

36 Further it was submitted that if the language is held to embrace the joint privilege that arises in this case, then s 124 would have no application in any case because of the presence in the civil proceeding of other parties who did not either jointly retain the lawyer or share in the joint privilege. It was submitted that where the evident purpose of the section is to enable the people who share the privileged material to use it as between themselves in litigation, the presence of other parties that do not share that joint privilege precludes the application of s 124 of the Act. Thus it was submitted that as long as there are parties to the proceeding which cannot share the joint privilege, the information the subject of the joint privilege cannot be adduced.

37 The plaintiffs concede that the wording of s 124 is narrower than the position at common law. In particular, s 124(1) states that the section applies where two or more parties have "jointly retained" a lawyer. However, the plaintiffs contend that "retainer" has been given an expansive definition under s 124.[10]

38 In other contexts concerning privilege (outside the context of s 124) the plaintiffs contend that it has been held that it is not necessary that there be a valid contract of retainer between the lawyer and the client for privilege, whether client legal privilege under the Evidence Act or legal professional privilege at common law, to exist.[11] Furthermore, at common law there are authorities to the effect that joint privilege applies as between a company and its directors and the legal advisors even though the legal advice had not been jointly commissioned by the company and its directors, but only by the company[12] and where the contract for legal advice was only between one of the clients and the legal advisors.[13]

1"> 39 In my opinion s 131A is not relevant. It does not apply. So far as production by Patrikeos and Mews is concerned they are not objecting to production or disclosure of the document and the section is not attracted.[14] So far as GSMAL is concerned it does not object to providing the document. The document was given by GSMAL by way of discovery of an unredacted version thereof in recognition of the joint privilege. Under the section the objections must relate to the giving of information or the production of a document and then whether or not there should be disclosure is determined as if the evidence was adduced at trial. However the issue before me is not about any objection to the giving of information or the production of a document but rather the use of the disclosed document at trial. The fact that s 124 has not been excluded from the operation of s 131A does not, by reason of this fact, mean that it is readily applicable. Clearly any objection to disclosing legal advice in response to a subpoena can easily be dealt with under ss 131A and 118. It is not the case with s 124.

40 Section 124 relates to the adducing of evidence at trial. I propose to deal with the matter by putting myself in the position of the trial judge. Otherwise what is the point of the reference to me. The plaintiffs have clearly indicated that they intend to tender the document so that the matter is not hypothetical. They rely on s 124 and contend that the joint privilege has been lost for the reasons advanced. I will deal with the substance of the section. Does s 124 destroy the privilege because the joint holders are adversaries in litigation involving other parties? In answering this question the critical issues of 'joint retainer' and 'same matter' need to be considered.

1"> 41 In my opinion s 124 does apply and has the effect contended for by the plaintiffs. When the 2005 Board Paper is tendered at trial it cannot be met with a claim of joint privilege. The joint privilege has been lost for the reasons set out hereunder.

42 The critical issue is whether in the circumstances there was a joint retainer. As pointed out the authorities support the proposition that there can be joint privilege in the absence of a joint retainer.[15] However in such a case s 124 will not apply. The common law will continue to apply. In order for s 124 to apply joint privilege must arise out of a joint retainer.

43 It is not a requirement of a joint retainer that a specific contractual document be entered into between each of the parties and the lawyer. Nor is it required that each party communicate directly with or instructed the lawyer or that the lawyer direct any advice to each of the parties.[16]

44 In Doran Constructions at [62] Campbell J said:

"I should also say that Mr Freeman's evidence, that during the meeting he was not asked to provide legal advice to Doran Constructions, is of little assistance. It is perfectly possible for there to be a conclusion that there was a retainer by, amongst others, Doran Constructions, even if no one in the course of the meeting said words to the effect of, 'Will you please now advise Doran Constructions'."

"In my view, there was a joint retainer in the present case. While the impetus for the transaction was, I accept, that Doran Holdings had been asked by its financiers to clean up its intercompany loan accounts, that 'cleaning up' process required cooperative action on the part of all four companies involved. There is no basis for believing that any of the companies whose cooperation was involved, were excluded from the advice which was given. Certainly none of them sought advice from anyone other than Mr Freeman. That Doran Holdings was the impetus for the transaction, but all the companies needed to cooperate, is well captured by Mr Joyce's statement at the meeting, 'Holdings wants to do a series of transactions to take the loans out of Holdings and place them in the Constructions group. Chris what are your thoughts on how we should go about it?'."

46 Although the facts are different the case supports the proposition that those receiving the benefit of the advice may, despite not being actively involved in engaging the lawyer, be embraced by the retainer.

47 In Pioneer Concrete, Simos J found that lawyers engaged by the company in that proceeding were acting for both the company and its directors, and thus joint privilege arose, as:

"the defendant did have the view that the communications from the barristers were communications to him as a client, and did believe on reasonable grounds that the lawyers giving advice were his lawyers so as to entitle the defendant to privilege ... the true substance of the arrangements between the lawyers and the company was to the effect that the lawyers would advise as clients both the company and the former directors in their personal capacities although all legal fees were to be paid by the company."[17]

48 In Pioneer Concrete it was not necessary or relevant to determine whether there was a joint retainer. If the matter was relevant the court would in my view have held that there was a joint retainer.

"Two or more persons may join in communicating with a legal adviser for the purpose of retaining his or her services or obtaining his or her advice. The privilege which protects these communications from disclosure belongs to all the persons who joined in seeking the service or obtaining the advice. The privilege is a joint privilege. So is it also if one of a group of persons in a formal legal relationship communicates with a legal adviser about a matter in which the members of the group share an interest. Communications by one partner about the affairs of the partnership or a trustee about the affairs of the trust are examples. Implicit in the relationship is the duty or obligation to disclose to other parties thereto the content of the communication. Accordingly no privilege attaches to such communications as against others who, with the client, share an interest in the subject matter of communication." [18]

50 In Farrow Mortgage Services it was also not necessary to determine whether there was a joint retainer. If this was necessary, as in Pioneer Concrete, in my view the court would have held that there was a joint retainer.

51 When GSMAL received the relevant legal advice it did so not only on its own behalf but also on behalf of the plaintiffs because of the legal relationship (trustee and beneficiary) of the parties. It is precisely because of this very relationship that the plaintiffs shared a very real direct interest in the advice and as a consequence are entitled (as all parties agree) to joint privilege over the relevant document. Though the lawyers were engaged (to use a neutral word), paid and instructed directly by GSMAL, this does not preclude the plaintiffs from the lawyer-client relationship. To the contrary. In my opinion, and in the circumstances, it may fairly be said that that the solicitor was jointly consulted and that in context there was a joint retainer.

52 Finally, I do not accept the very narrow construction of the words 'joint retainer' contended for by GSMAL. The law clearly regards a joint retainer as existing in circumstances where one party did not necessarily have any involvement with the engagement and the provision of instructions to the lawyer. The joint retainer is assumed and presumed and is implicit in the circumstances given the relationship between the parties.

53 There is no definition of matter in the Evidence Act. However the section assumes that the matter in respect of which the lawyer has been retained is relevant to "the civil proceeding". The section is not dealing with privilege in a vacuum. Accordingly there needs to be some correlation between the privileged information or documents and the proceeding between the holders of the joint privilege. To determine whether there is the necessary correlation it is necessary to look at what matters the advice is in relation to and what the subject matter of these proceedings is.

54 GSMAL's own characterisation of the redacted portions of the advice is as follows:

"The advices concern matters connected with the construction of the 1994 Land Management Agreement and related matters."

55 The affidavit of Ms Fleischer regarding the advice also indicates that the advice relates to the 1994 management investment schemes and the potential for sale of standing timber under those schemes to GSMAL or a related entity. I note that Ms Fleischer goes further noting that:

"The issue affected not only the 1994 Project, but all other plantation management investment schemes of which GSMAL was the responsible entity, including the Great Southern Plantations 2005 Project ... ."

56 GSMAL submits that these matters, regarding the 1994 scheme, are different to the subject matter of the present proceedings. GSMAL contended that the matter the subject of the proceedings is the "product disclosure statement issued by GSMAL in respect of the 2005 and 2006 plantation schemes" as well as other PDSs issued in relation to later schemes.

57 While GSMAL is correct that these proceedings are concerned with certain PDSs issued by GSMAL in relation to the 2005, 2006 and later schemes, this does mean that issues relating to the 1994 Land Management Agreement and advice received by GSMAL in relation to that agreement are not relevant.

58 The plaintiffs' Amended Statement of Claim, when referring to the likelihood that yields forecasted in the PDSs were to be achieved, makes specific reference to the 1994 scheme, as follows:

"GSL and/or GSMAL engaged Allens Arthur Robinson and KPMG to provide advice on the sale of the 1994 Scheme harvest to a related entity of GSL at a price higher than would have been derived through the harvesting, proceeding and Freight on Board sale of the timber resource."

59 Section 124 applies to civil proceedings that are "in connection with" a matter that two or more parties have previously retained a lawyer in relation to. It allows such parties to adduce evidence of confidential documents prepared for them by that lawyer that are "in connection with that matter".

60 Though this case is not the 'classic' s 124 case - such as two joint venturers having a falling out after jointly receiving legal advice regarding their joint venture - that is not to say s 124 does not apply.

61 Here GSMAL has, jointly with the plaintiffs (through the trustee/beneficiary relationship), engaged lawyers to provide advice in relation to the sale of the 1994 schemes harvest. The plaintiffs have since brought proceedings against GSMAL, and others, in relation to PDSs regarding the 2005, 2006 and later schemes. Part of the plaintiffs' claims relate to GSMAL's dealings with the 1994 scheme and advice GSMAL received regarding those dealings. Consequently it is not correct to say that advice regarding the 1994 scheme has no connection with these proceedings.

62 On balance I am inclined to view that the advice is sufficiently related to the civil proceeding. The section does not require that the proceedings only deal with the matter that is the subject of the advice, nor does it require a large or significant proportion of the proceedings to be in relation to the matter the subject of the advice. While the advice here may only be in connection with a small part of these proceedings, in my view that is sufficient to attract the operation of s 124.

63 In my opinion if s 124 otherwise applies it matters not whether there are other parties to the proceeding.

64 Finally if the section is construed very narrowly and contrary to the construction set out above and excludes the operation of the common law, it would have the effect of substantially eroding established and long standing legal principle. It would in such circumstances clearly be open to deal with the claim that privilege has been lost in accordance with common law principles. In fact, it is more accurate to say that the common law continues to apply unless it is inconsistent with s 124.[19] If s 124 is construed very narrowly, the wider application of the common law will not be inconsistent but complimentary. The result would be the same.[20]

II Loss of Joint Privilege - the Calcraft v Guest submission

65 The plaintiffs submitted that any privilege that GSMAL may have held in the 2005 Board Paper as recipient of the advice (such as client legal privilege under s 118 of the Evidence Act) is now lost by virtue of the fact that the Board Paper is now in the hands of the plaintiffs who seek to tender it in evidence.[21]

66 The plaintiffs submitted that this was not a waiver point but a doctrine which applies irrespective of how the document came into the hands of the plaintiffs. The plaintiffs referred to various authorities including a statement of Mandie JA in ASIC v Lindberg at [51]:

"once such documents come into the possession of another party, the privilege is lost or cannot be asserted except in the context of a claim in equity to protect confidentiality."[22]

67 Although there is no provision in the Evidence Act which expressly provides for the Calcraft v Guest doctrine, it was submitted that the doctrine still applies in Australia and the Evidence Act has not "otherwise provided" under s 9(1) of the Evidence Act. Indeed, the plaintiffs submitted that the Calcraft v Guest approach to loss of privilege "serves to inform the approach to be taken to the Evidence Act".[23] Hence it remains good law in Australia and provides an irrefutable answer to any prospective objection to the tender of the Board Paper by the plaintiffs in this case.

68 GSMAL also referred to Lindberg and in particular to a qualification to the above statement as follows:

"The position is likely to be different if that party has obtained the privileged documents or information from the person entitled to the privilege on a confidential basis as exemplified in the cases of Mann v Carnell [1999] HCA 66; (1999) 201 CLR 1 and Spotless Group Ltd v Premier Building & Consulting Pty Ltd (2006) 16 VR 1."[24]

69 The plaintiffs obtained the privileged material as of right on the footing that they shared that privilege. The privilege has been lost and they are entitled to use the document.

70 If the joint privilege has not been lost, whether under s 124 or at common law, the privilege would remain. If it is not lost and remains neither party is entitled to use the document as against the other. It is no answer in such circumstances to say that 'we have it'. Possession of a document that is subject to joint privilege does not entitle a party entitled to the privilege to use the document. This is the position with all cases involving joint privilege. The document cannot simply be used because it is in the possession of one of the parties. I am not persuaded by the plaintiffs' submissions. The document can only be used if the privilege has been lost. I agree with the second to fifth defendants' submissions to the effect that if the doctrine applied s 124 would be rendered otiose. The plaintiffs were provided with the 2005 Board Paper on the sole and exclusive basis that they were entitled to it as a joint privilege holder. As such any use was required to be dealt with on this basis. They are entitled to tender the document because privilege has been lost. Otherwise the privilege would remain and the document could not be tendered.

71 However, in view of the conclusion I have reached it is not necessary to deal with the limits of the doctrine and I do not propose to do so.

72 I do not propose to deal with the Originating Process. It is not necessary or desirable at this stage.

73 The position in relation to the 2006 Board Paper is far from clear. Most of the argument was directed to the 2005 Board Paper. I have read the unredacted version of the 2006 Board Paper and am not sure what the problem is and why the parties are unable to sort the matter out. I will give the parties an opportunity to resolve the matter. If they do not any party is at liberty to bring the matter back before me.

74 As indicated I do not propose to deal with the Originating Process and will simply adjourn that proceeding sine die. It may be a useful and convenient vehicle for any further dispute.

75 As to the application for costs made by those parties originally and mistakenly joined to the Originating Process I will deliver my reasons regarding that application when dealing with the costs generally in relation to this matter. No further argument is required.

76 I will hear from the parties in relation to the precise form of order and costs.

Great Southern Limited (Receivers and Managers Appointed)(In Liquidation)

[1] The first proceeding commenced 27 May 2010.

[2] Calcraft v Guest [1898] 1 QB 759 as applied by Mandie JA in ASIC v Lindberg [2009] VSCA 234; (2009) 25 VR 398 at 406 [46] ("Lindberg"); Baker v Campbell [1983] HCA 39; (1983) 153 CLR 52 at 67 (Gibbs CJ); Hodgson v Amcor Ltd [2011] VSC 269 at [76]- [81].

[3] Reference was made to the following authorities: Re Dallhold Investments Pty Ltd [1994] FCA 1398; (1994) 53 FCR 339 at 348; and HIH Insurance Ltd [2002] NSWSC 231 at [21]. See also Commissioner for Corporate Affairs (WA) v Eastoe (1989) 1 WAR 271 discussed in Re Dallhold Investments Pty Ltd 91994) [1994] FCA 1398; 53 FCR 339 at 346-347 and in S McNicol, Law of Privilege (Law Bk Co Ltd, 1992) at p 22, footnote 123.

[4] The plaintiff sought to draw an analogy with cases such as Benecke v National Australia Bank (1993) 35 NSWLR 110 at 111 and 116 where the Court held that legal professional privilege in communications is lost where the client sues the lawyer. This principle is discussed by the High Court in Osland v The Secretary of Department of Justice (2008) 234 CLR 275 at 297.

[5] See Re Nika Management Services Pty Ltd (in liq) (1996) 14 ACLC 326 and Farrow Mortgage Services Pty Ltd v Webb (1996) 14 ACLC 1240 ("Farrow Mortgage Services").

[6] Mr D Kerr, Minister for Justice as quoted in JD Heydon, A Guide to the Evidence Acts 1995 (NSW) and (Cth) (1997, 2nd ed.) at p 59.

[7] Reference was made to G Bellamy & P Meibusch, Commonwealth Evidence Law, AGPS, 1998, 2nd ed, [124.3], 202; and S. McNicol, "Professional Privilege Spreads its Wings" (1996) 70 LIJ 32 at [35].

[10] Reference was made to Re Doran Constructions Pty Ltd (in liq) [2002] NSWSC 215; (2002) 194 ALR 101 at 118-9 [76] and [81] ("Doran Constructions"). See also, at common law, Pioneer Concrete (NSW) v Webb (1995) 18 ACSR 418 ("Pioneer Concrete"); and Global Funds Management (NSW) Ltd v Rooney (1994) 36 NSWLR 122.

[11] Reference was made to Grofam Pty Ltd v Australia and New Zealand Banking Group Ltd [1993] FCA 501; (1993) 45 FCR 445 at 455-456; Health Insurance Commission v Freeman [1998] FCA 1340; (1998) 88 FCR 544 at 566-567; Brookfield Multiplex Ltd v International Funding Partners Pte Ltd (No 2) [2009] FCA 449; (2009) 256 ALR 416 at 422; and Hawksford v Hawksford [2008] NSWSC 31 at 20.

[12] Farrow Mortgage Services Pty Ltd v Webb (1996) 14 ACLC 1240.

[13] Pioneer Concrete (NSW) v Webb (1995) 18 ACSR 418.

[14] New South Wales v Public Ticketing Corporation [2011] NSWCA 60 at [32] (Allsop P).

[15] See the authorities referred to in footnote 11.

[16] Re Doran Constructions Pty Ltd (in liq) [2002] NSWSC 215; (2002) 194 ALR 101 at [24], [62] and [76]. Rather, the concept of a joint retainer is wide enough to embrace the situation where because of the relationship of the parties the non-active or passive party is entitled to receive any advice and may properly be regarded as jointly consulting the lawyer.

[20] Benecke v National Australia Bank (1993) 35 NSWLR 110 at 111 and 116; Osland v The Secretary of Department of Justice (2008) 234 CLR 275 at 297; Re Nika Management Services Pty Ltd (in liq) (1996) 14 ACLC 326; and Farrow Mortgage Services Pty Ltd v Webb (1996) 14 ACLC 1240.

[21] Calcraft v Guest [1898] 1 QB 759 as applied by Mandie JA in ASIC v Lindberg [2009] VSCA 234; (2009) 25 VR 398 at 406 [46]; Commissioner, AFP v Propend Finance Pty Ltd (1997) 188 CLR 501, at 565 (Gummow J); Baker v Campbell [1983] HCA 39; (1983) 153 CLR 52 at 67 (Gibbs CJ); Cowell v BATAS Ltd [2007] VSCA 301 at [32]- [34] (Warren CJ, Chernov and Nettle JJA); and Hodgson v Amcor [2011] VSC 269 at [78].

[23] Reference was made to Hodgson v Amcor [2011] VSC 269 at [76] (Vickery J).

[24] ASIC v Lindberg [2009] VSCA 234; (2009) 25 VR 398 at 409 [51], fn 30.

At a glance

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Decision date

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Judgment (131 paragraphs)

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Legislation Cited (6)

Cases Cited (15)