(6) It may be difficult to establish at an early stage whether documents which were before an expert witness influenced the content of his or her report, in the absence of any reference to them in the report: cf Dingwall v Commonwealth of Australia (1992) 39 FCR 521; Tirango Nominees Pty Ltd v Dairy Vale Foods Ltd (No 2) (1998) 83 FCR 397 at 400; 156 ALR 364 at 366; ACCC v Lux at [46]."
11 Lindgren J's item (3) refers to the judgment of Thomas J in Interchase Corporation Ltd v Grosvenor Hill (Queensland) Pty Ltd (No 1) [1999] 1 Qd R 141. It is pertinent to quote from his Honour's judgment (at p.162):
"We are concerned in this case with discovery and production of documents. A necessary basis for privilege to attach to anything - document or otherwise - is that it records a communication. The material in categories B, C, D and E has remained in Richard Ellis's possession, and has not been the subject of any communication with the solicitors, or for that matter anyone else. The basis upon which privilege was claimed for these documents is confined to the claim that they were 'brought into existence by Richard Ellis solely for use in this litigation since its commencement and have been kept confidential.' (my italics). The italicised words draw attention to what is missing, and expose a deficiency in the claim. The documents consist mainly of working papers and valuations of other properties, and lack the quality of confidentiality. There is no reason to think that the documents were made for any confidential purpose. The other deficiency is that they were not communicated or intended to be communicated to anyone. In Commissioner of Federal Police v Propend Finance Pty Ltd (1997) 188 CLR 501, 552, McHugh J underlined the fundamental point that the subject matter of privilege is communications .
'This point, however trite it may seem, is fundamental to the determination of the present appeal. Much of the confusion present in the case law arises from a failure to apply it. Legal professional privilege is concerned with communications, either oral, written or recorded, and not with documents per se.'
In the present matter, shortly put, the documents in no way make or record communications, let alone confidential communications.
I would hold that in general, when an expert is engaged by a solicitor for the purpose of giving evidence in a case, documents generated by the expert and information recorded in one form or another by the expert in the course of forming an opinion are not a proper subject for a claim of legal professional privilege. Privilege may however be claimed in relation to communications between the expert and the solicitor (both ways) when such communication is made for the purpose of confidential use in the litigation. Beyond this there is no sufficient reason why any material relevant to the formation of the expert's opinion should be subject to a claim of legal professional privilege. It is as well to add that an expert or solicitor may not artificially manufacture privilege by, for example, the expert sending in his or her file to the solicitor. Documents of this kind simply are not confidential."
12 The point made here is that privilege can only attach to documents which embody communication between the expert and the litigant by whom the expert is retained (or the litigant's lawyer). A draft report prepared by the expert is not, of its nature, such a communication. It may be that the draft report is, in fact, given or sent by the expert to the litigant or the litigant's lawyer, but that does not change its character as something prepared by the expert which is not intended to be a means of communication with the litigant or lawyer.
13 I accept the defendants' submissions in respect of the documents referred to in paragraph 4(g) of Mr Jackson's affidavit of 17 August 2005. They are not, of their nature or in the circumstances referred to in that paragraph, documents in which legal professional privilege subsists.
14 The defendants also make a broader submission, namely, that privilege in all the documents produced by KPMG has been waived. That submission has as its factual basis the circumstance that, after KPMG had prepared a draft report or draft reports, Deloittes were instructed in place of KPMG and that, in the letter of instruction to Deloittes dated 18 April 2005, the plaintiffs' solicitor said:
"We note that the valuation documents are now immediately available for collection from KPMG's office … Please arrange a convenient time to collect the documents as early as possible."
15 The defendants say that, in these circumstances, it is inevitable that formulation of the plaintiffs' instructions to Deloittes would have been influenced by the prior dealings between the plaintiffs' solicitor and KPMG which traversed the same ground. The defendants point, in that regard, to item (4) in the extract from the judgment of Lindgren J in Australian Securities and Investments Commission v Southcorp Ltd set out above, contending that the principle stated thus in the majority judgment in Mann v Carnell (1999) 201 CLR 1 at 13 is thereby triggered:
"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."
16 On the material available at this point, I am not satisfied that the plaintiffs have acted, in relation to documents given to or otherwise possessed by KPMG, in a way that is inconsistent with maintenance of privilege. But because privilege has now been waived in respect of documents produced by Deloittes, the principle to which Lindgren J referred at item (4) operates to place outside the protection of privilege such of the documents produced by Deloittes as are documents with which Deloittes were briefed, including any that they collected from KPMG in response to the invitation in the plaintiffs' solicitors' letter of 18 April 2005.
17 In summary, therefore, I am of the opinion that the documents referred to in paragraph 4(g) of Mr Jackson's affidavit of 17 August 2005 are not covered by client legal privilege, so that access to them should be granted; and that, at this stage, the defendants have not shown that the privilege claimed in any of the other relevant documents has been waived. In putting the matter in those terms, I do not intend to suggest that the onus is on the defendants. On the contrary, the burden of establishing the privilege claim rests squarely with the plaintiffs. They have not, to this point, discharged the onus. One possibility is therefore that the claim should be regarded as not made out, with an order for access being made in favour of the defendants. A more palatable option, in my opinion, is the alternative outcome for which the defendants contend, namely, that the plaintiffs be given one last opportunity to show the basis of their claim in an informative and constructive way - but on a footing that causes access to be granted automatically in relation to any document in respect of which the last opportunity is not duly taken up.
18 I make the following orders:
1. Direct that the plaintiffs have such leave as is necessary to enable them to access all documents produced to the court under notice to produce or subpoena by KPMG, Lachlan Wolfers and Nicholas John Ryder and held in packets numbered 4, 7, 8, 10 and 11 (marked privileged) for the purpose of
(a) identifying by some appropriate flag or mark every document referred to in paragraph 4(g) of the affidavit of Grahame Jackson sworn on 17 August 2005; and
(b) recording such particulars as are required by them for the purpose of complying with Order 4.
2. Order that the plaintiffs, not later than 27 January 2006, identify documents as contemplated by Order 1(a) and record particulars as contemplated by Order 1(b).
3. Order that the defendants have general access to all documents identified as contemplated by Order 1(a).
4. Order that, not later than 6 February 2006, the plaintiffs (in the case of the first plaintiff personally and in the case of the second plaintiff by its director) make, file and serve on the defendants an affidavit containing separately, in respect of each and every document in the said packets numbered 4, 7, 8, 10 and 11 (not being a document identified as contemplated by Order 1(a)), the following particulars:
(a) the party who produced the document to the court;
(b) the date of the document;
(c) the author of the document;
(d) to whom the document was sent, if applicable;
(e) the title and general nature of the document;
(f) whether the plaintiffs make a claim for legal professional privilege over the document;
(g) the basis of the claim for privilege and any other matters necessary to establish that claim; and
(h) where there is an attachment to the document, the matters stated in paragraphs (a) to (g) above in relation to each attachment.
5. Order that, after the earlier of 6 February 2006 and the day on which an affidavit is served in compliance with Order 4, the defendants have general access to each and every document contained in the said packets 4, 7, 8, 10 and 11 which is not identified in any such affidavit as a document in respect of which the plaintiffs make a claim for legal professional privilege.
19 Because the defendants have been successful in their application, I also order that the plaintiffs pay the defendants' costs of the notice of motion, including all costs occasioned by the plaintiffs' claim for privilege over the documents in the said packets 4, 7, 8, 10 and 11.
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