(2004) 201 CLR 552
Amcor Limited and Ors v Barnes and Ors [2011] VSC 341
Attorney-General (NT) v Kearney [1985] HCA 60
(1964) 112 CLR 125
Imerman v Tchenguiz and Ors
Lep Air Services Ltd v Rolloswin [1973] AC 331
Project Blue Sky Inc v Australian Broadcasting Authority [1998] HCA 28
194 CLR 355
R v Cox and Railton (1884) 14 Q.B.D. 153
Spencer v Commonwealth of Australia [2010] HCA 28
Source
Original judgment source is linked above.
Catchwords
(2004) 201 CLR 552
Amcor Limited and Ors v Barnes and Ors [2011] VSC 341
Attorney-General (NT) v Kearney [1985] HCA 60(1964) 112 CLR 125
Imerman v Tchenguiz and OrsLep Air Services Ltd v Rolloswin [1973] AC 331
Project Blue Sky Inc v Australian Broadcasting Authority [1998] HCA 28194 CLR 355
R v Cox and Railton (1884) 14 Q.B.D. 153
Spencer v Commonwealth of Australia [2010] HCA 28
Judgment (6 paragraphs)
[1]
Judgment
The Court is required to deal with a motion seeking summary dismissal of the proceedings on the basis that they amount to an abuse of process. Other orders are sought in the alternative. In order to understand the issues in the proceedings, it is necessary to describe the substantive proceedings and how the prayers in the motion arise.
On 2 July 2015, the plaintiff commenced proceedings against the New South Wales Crime Commission ("the Commission") and the State of New South Wales seeking damages for breach of contract. The contract was said to exist between the plaintiff, who, it is said, was engaged as a Confidential Informer to the Commission and for so acting the Commission would pay sums of money to the plaintiff for expenses and for information provided.
The substantive proceedings, commenced by Statement of Claim, allege that the express terms of the contract or series of contracts involved the plaintiff pro-actively seeking out information for the Commission in relation to criminal activities and providing that information to the Commission in a timely manner. The Commission would, from time to time, according to the Statement of Claim, direct the plaintiff to seek out particular information, which the plaintiff would seek to obtain and, if obtained, provide that information to the Commission in a timely manner.
The plaintiff also alleges in the Statement of Claim that the contract provided that, for so long as the plaintiff remained a reliable and productive source of information, the plaintiff would be entitled to $500 for expenses, payable weekly. Further, the plaintiff would be paid for providing actionable intelligence (whether or not that intelligence led to arrests, convictions and/or seizures) on a basis calculated in accordance with the system maintained by the Commission.
The relationship between the plaintiff and the Commission was to be kept strictly confidential and would be known only to the Commissioner, the plaintiff, the solicitor/Director or other Assistant Director of the Commission and the Commission's handler (being the Commission's appointed nominee to deal, on behalf of the Commission, with the plaintiff).
The plaintiff alleges that the Commission has breached the contract or contracts and not paid moneys that are due and owing to the plaintiff and also claims other loss and damages.
The plaintiff also claims a breach of the duty of care owed by the Commission on account of its knowledge that the plaintiff was providing information about persons who are both violent and ruthless and the Commission and/or the State of New South Wales was required to keep the identity of the plaintiff and the content of the information confidential in order not to expose the plaintiff to the particular and peculiar risk associated with the provision of the information to the Commission. It seems, although it is not absolutely clear, that the allegations in relation to the breach of duty of care relate to a duty of care arising under the contract or contracts (see cl 15 of the Statement of Claim).
The plaintiff alleges that the Commission (and/or the State of New South Wales) has breached its duty of care by not preserving the confidentiality of the plaintiff's identity and the plaintiff's relationship with the Commission. As a consequence of that breach the plaintiff has suffered loss and damage, being the loss and damage pleaded in relation to the breach of contract.
Particulars have been filed and were filed with the Statement of Claim, in a separate document, and filed pursuant to r 15.9 of the Uniform Civil Procedure Rules 2005 (UCPR).
The Commission's defence denies the existence of a contract and asserts, relevantly, that any payment for expenses or sustenance, was not made pursuant to any contractual or other obligation so to do. Further it denies that any amount is owed.
The Commission also asserts that any agreement that may otherwise have existed was an agreement in which there was no intention to create legal relations, no certainty of terms and that any payment made or to be made was wholly within the discretion of the Commission and unenforceable for reasons of public policy.
The hearing of the matter is complicated by the need to prove the existence of the contract and the terms of the contract, if any. For that purpose the plaintiff issued a Notice to Produce.
The Commission, as part of its motion, sought to have the Court set aside the Notice to Produce on the basis that the provisions of the statute governing the operation of the Commission (and in particular, s 80 of the Crime Commission Act 2012) prevented any person who is or was an officer or employee of the Commission or an agent of the Commission producing in Court any document that has come into the person's possession, custody or control as a result of the exercise of that person's functions for or with the Commission. Communication of information obtained or acquired by a person in the exercise of functions under the Crime Commission Act ("the Act") is a criminal offence.
On the foregoing basis, the Commission sought to set aside the Notice to Produce. The plaintiff no longer presses the Notice.
Moreover, the Commission seeks to dismiss the proceedings taken against it, pursuant to UCPR r 13.4 on the basis, it seems, that the proceedings are an abuse of the process of the Court, because the proceedings rely upon a breach of s 80 of the Act by an officer or former officer of the Commission in providing information to the plaintiff. The provision of that information, it is said, was a breach of s 80 of the Act and, therefore, the proceedings depend upon an illegality and that illegality or dependence renders the proceedings an abuse of process.
In order to prove that the plaintiff's cause of action depends upon information provided by an officer or former officer of the Commission, contrary to s 80 of the Act, the Commission has issued notices seeking to compel the production of documents in the hands of the plaintiff or the plaintiff's legal advisors that would disclose such information. To those notices the plaintiff has, to a large measure, claimed legal professional privilege and the Commission argues that the legal professional privilege is vitiated by the illegality associated with the provision of the information.
Lastly, the plaintiff submits that, if the provision of the information by an officer or former officer of the Commission is illegal, pursuant to the provisions of s 80 of the Act, and such illegality prevents legal professional privilege from arising, the provisions of s 80 of the Act are unconstitutional and inoperative or invalid, at least in so far as the statute would otherwise operate in the manner alleged.
As a consequence of the allegation of invalidity arising under the Constitution, a s 78B Notice, being a notice required to be served under s 78B of the Judiciary Act 1903 (Cth), has been filed and served on each of the Attorneys General. Only the NSW Attorney General seeks to appear in relation to that notice.
[2]
The Crime Commission Act
The principles that apply to the construction of the statute are well known and do not need repeating at length. The statute must be read as a whole and its terms construed in order to achieve the purposes of the legislation on the basis that the legislature is presumed to intend the achievement of harmonious goals. Ordinarily, the words of a statute are given a meaning that corresponds with the grammatical meaning of the provisions. Sometimes, where the achievement of the purposes of the legislation or the ordinary rules of construction require it, the words may be given a different meaning.
That different meaning arises, occasionally, when the achievement of the legislative intention to give effect to harmonious goals is better served by an available construction that achieves those purposes: Project Blue Sky Inc v Australian Broadcasting Authority [1998] HCA 28; 194 CLR 355.
As a consequence of the application of the foregoing brief and somewhat trite summary of principle, it is necessary to examine the scheme of the Act. The object of the Act is to reduce the incidence of organised and other serious crime. For that purpose the legislation establishes the Commission as a corporation with the functions conferred and the duties imposed under the Act and any other statute. The Commissioner, appointed by the Governor, is authorised to act on behalf of the Commission and any act performed with the authority of the Commissioner is taken to have been done by the Commission (s 7 of the Act).
The principal functions of the Commission are prescribed by s 10 of the Act and include the investigation of matters relating to a relevant criminal activity or serious crime concern; the investigation of matters relating to the criminal activity of criminal groups; the assembling of evidence admissible in the prosecution of a person for a relevant offence; the furnishing of evidence obtained in the course of its investigations to the Attorney General or to the appropriate authority in the jurisdiction concerned; the furnishing of reports, in accordance with the Act, relating to organised and other crime; to provide investigatory, technological and analytical services to such persons or bodies as the Commission thinks fit; and to work and to co-operate with such persons or authorities of the Commonwealth, the State or another State or Territory as the Commission considers appropriate.
A number of the functions require referral of issues from the Management Committee. The Management Committee is established under s 49 of the Act and its members are prescribed by s 50 of the Act. Its functions, which I do not here repeat, are described in s 51 of the Act but, interestingly, the Commission, if it considers it appropriate to do so, may request the Management Committee to refer to the Commission a matter relating to relevant criminal activity and/or a police enquiry (s 56 of the Act).
Further, by s 57 of the Act, the Management Committee may give directions and furnish guidelines to the Commission with respect to the exercise of its functions. The Commission is required to comply with such directions or guidelines.
Section 74 of the Act defines the staff of the Commission, being those persons employed in the Public Service under the relevant statutory prescriptions, consultants engaged under s 74(2) of the Act, persons seconded from other staff or facilities of government under s 74(3) of the Act and police officers of the Commonwealth, a Territory and another State organised to perform services for the Commission pursuant to the terms of s 74(4) of the Act.
Executive Officers of the Commission are the Commissioner and any and all Assistant Commissioners (see the definition in s 4 of the Act).
The Commission is given functions under the Criminal Assets Recovery Act 1990 (s 11 of the Act). The Commission may, if it considers it desirable, furnish information relating to the exercise of the functions of government agencies to the relevant ministers and make recommendations (s 12 of the Act) and liaise with other bodies, in accordance with the guidelines furnished by the Management Committee by disseminating intelligence and information to such persons or bodies of the Commonwealth, the State or another State or Territory or country as the Commission thinks appropriate and co-operate and consult with such persons or bodies (s 13 of the Act).
The Commission is given incidental powers to do all things necessary to be done for, or in connection with, or reasonably incidental to, the exercise of its functions, whether general or specific (s 14 of the Act).
The Commission conducts hearings (Div 4 of the Act) and may require information from government agencies and persons (Div 5 of the Act). A refusal to produce (subject to certain safeguards) is an offence (see s 25 and s 35 of the Act).
Pursuant to the terms of s 48 of the Act, an Executive Officer, when exercising the functions of an Executive Officer, has the same protection and immunity as a Judge of the Supreme Court. Similarly, legal practitioners and witnesses have similarly described immunities as do persons producing documents to the Commission. No criminal or civil liability attaches to a person for compliance or purported compliance in good faith, with any requirements of the Act.
There is no specific power for the payment of "sources", but given the functions of investigation into criminal activity, the payment of persons for information would be a function permitted by the general ancillary powers to which reference is made above. It is appropriate to turn to the provision of the Act that is most relevant to the issues before the Court.
Section 80 of the Act is the "Secrecy" provision. It is in the following terms:
"80 Secrecy
(1) This section applies to a person:
(a) who is or was an executive officer, and
(b) who is or was a member of the staff of the Commission, and
(c) who is or was an Inspector or a member of the staff of the Inspector, and
(d) who is or was an Australian legal practitioner appointed to assist the Commission or who is or was a person who assists, or performs services for or on behalf of, such an Australian legal practitioner in the exercise of the Australian legal practitioner's functions as counsel to the Commission, and
(e) who is or was a member of a task force assisting the Commission in accordance with an arrangement under section 58, and
(f) to whom information is given by the Commission or by a person referred to in paragraph (a), (b), (c), (d) or (e) after expressly informing the person that the information is to be treated by the person as confidential.
(1A) This section applies to a person conducting a review under section 78B in relation to the person's functions under that section.
(2) A person to whom this section applies must not, directly or indirectly, except for the purposes of this Act or otherwise in connection with the exercise of the person's functions under this Act:
(a) make a record of any information, or
(b) divulge or communicate to any person any information, being information acquired by the person because of, or in the course of, the exercise of functions under this Act.
Maximum penalty: 50 penalty units or imprisonment for 12 months, or both.
(3) A person to whom this section applies cannot be required:
(a) to produce in any court any document or other thing that has come into the person's possession, custody or control because of, or in the course of, the exercise of the person's functions under this Act, or
(b) to divulge or communicate to any court any matter or thing that has come to the person's notice in the exercise of the person's functions under this Act.
(4) Despite this section, a person to whom this section applies may divulge any such information:
(a) for the purposes of and in accordance with this Act, or
(b) for the purposes of a prosecution or disciplinary proceedings instituted as a result of an investigation conducted by the Commission in the exercise of its functions, or
(c) in accordance with a direction of the Commissioner, Inspector or Management Committee, if the Commissioner, Inspector or Chairperson of the Management Committee certifies that it is necessary for the information to be divulged in the public interest, or
(d) to any prescribed authority or person.
(5) An authority or person to whom information is divulged under subsection (4), and any person or employee under the control of that authority or person, is, in respect of that information, subject to the same rights, privileges, obligations and liabilities under subsections (2) and (3) as if he or she were a person to whom this section applies and had acquired the information in the exercise of functions under this Act.
(6) In this section:
'court' includes any tribunal, authority or person having power to require the production of documents or the answering of questions.
'produce' includes permit access to or inspection of.
As can be seen from the foregoing summary and the reciting of s 80 of the Act, the Commission is authorised to provide information to such persons or bodies of the State that the Commission thinks appropriate. As a consequence, s 80 of the Act could not create, as a criminal offence, the provision of information by the Commissioner (or any person authorised by the Commissioner) to persons or bodies of the State that the Commissioner thought appropriate. Yet, on its face, s 80 (other than s 80(4) of the Act) would render the divulgence of any such information a criminal offence.
The terms of s 80 must be understood in two ways. First, the prohibitions in s 80 do not apply to authorised disclosure of information. Secondly, s 80 of the Act does not apply to the Commission, itself. As a consequence of the latter, an act of the Commissioner, purporting to act on behalf of the Commission, is not governed by the prohibitions in s 80 of the Act.
Thus, the provisions of s 80(3) rendering some persons non-compellable refers to a person or persons described in s 80(1) and not to the Commission. This is not only because s 80 does not apply to the Commission itself, but also because a person, described in s 80(1) of the Act, does not "come into possession, custody or control" of a document or of information if the document or information is in the files of the Commission. Because the plaintiff no longer pursues its Notice to Produce, it is unnecessary to discuss this analysis further.
The other aspect in the construction of s 80 of the Act is that the section (and the Act) provides for its own consequences for a breach. A person to whom s 80 applies who, in contravention of the prohibition in the section, divulges information or provides documents to another person (without expressly informing the recipient that the information is to be treated as confidential) is guilty of an offence under s 80(2) of the Act. The section, however, on its face, does not prevent the recipient of the information from divulging it further.
On the contrary, the rights, privileges, obligations and liabilities under s 80(2) and s 80(3) of the Act are expressly conferred or required of persons who receive information under s 80(4) of the Act, but not otherwise. Nor does the provision make it illegal for an unauthorised person to receive information.
Presumably, a court would be required to facilitate the purposes of the Act and not to further or to effect criminal conduct in contravention of the purposes of the Act. This would be a matter that, it would seem, would at least be a consideration in the exercise of any of the powers or discretions available to the Court. Material obtained illegally that was sought to be tendered is governed by the provisions of s 138 of the Evidence Act 1995.
Once the Court embarks upon a construction of the provisions of s 80 of the Act, which construction accords with the purpose and objects of the Act, there are more obvious limitations on the application of the secrecy provisions and the criminal offence associated with its breach. The secrecy provisions of the Act (namely, the terms of s 80 of the Act) underpin the principal functions of the Commission in protecting the work of the Commission and, inferentially, the administration of justice, by prohibiting any disclosure of the investigation into relevant matters, the assembling of evidence in relation to such matters, the furnishing of evidence and reports and the like.
The Commission is, as earlier commented, established as a corporation and, as such, may buy, lease or rent property, purchase goods and enter into contracts for any of its ancillary functions. The provisions of s 80 of the Act are not intended and do not apply to information relating to those ancillary functions. Were the Commission to enter into a leasehold arrangement with a landlord, it would not be a criminal offence for the landlord to provide information provided to it by the Commission in that capacity. Likewise, were the landlord and the Commission, by way of example, to dispute as to the terms of the lease, it would not be impermissible (or otherwise illegal) for the landlord to seek, by Notice to Produce or otherwise, any notes relating to the terms of the contract for lease and for the Court to require its production.
A different attitude may be taken if the lease arrangements were to involve a particular property for the purpose of investigation into the occupants of an adjoining property. In other words, the provisions of s 80 and the requirements of secrecy and confidentiality relate to the disclosure of investigations, the disclosure of evidence and any information that would jeopardise or otherwise disclose aspects of such investigation, reporting or collating of evidence, namely, its special statutory functions. The secrecy provisions in s 80 of the Act do not, on such a purposive construction, go beyond such matters.
In circumstances where the Commission acts in its corporate capacity, as any corporation might, the secrecy provisions do not apply.
[3]
The Claim for Privilege
As earlier stated, in answer to the Commission's desire to obtain documents and/or information provided to the plaintiff (or the plaintiff's solicitor) by a former officer of the Commission, the plaintiff claims legal professional privilege. The Commission submits that the legal professional privilege is vitiated by the circumstance that the documents and/or information were provided by the officer in contravention of s 80 of the Act.
Pursuant to the provisions of r 1.9 of the UCPR, objection may be taken to the production of a document sought under a Notice to Produce (UCPR, r 34.1) on the basis that the document is a privileged document. A "privileged document" is defined in the dictionary (see UCPR, r 1.2) as a document that contains "privileged information". In turn, "privileged information" is information that is subject to a privilege by virtue of the operation of Div 1 of Pt 3.10 of the Evidence Act, s 126B of the Evidence Act, s 126H of the Evidence Act, or s 128, s 87, s 129, s 130 and s 131 of the Evidence Act. "Privileged Information" does not include information that the Court declares not to be privileged.
It is necessary to examine the provisions of the Evidence Act to determine whether information of the kind now sought by the Notice to Produce would, if it were sought to be tendered, be subject to legal professional privilege. It is unnecessary, at this juncture, to determine whether s 138 of the Evidence Act is available to the Court or whether to apply it.
A schedule of documents, the subject of a claim for client legal privilege, has been provided to the Court by the plaintiff, being a list of documents, with a short description of each document, upon which privilege is claimed. The claimed privilege is generally associated with the confidential communication between the lawyer for the plaintiff and a third person, the dominant purpose of which was the plaintiff being provided with professional legal services relating to an anticipated legal proceeding in Australia, being the substantive proceedings now before the Court on motion.
Such a privilege arises pursuant to the application of the UCPR and the operation of s 118 and/or s 119 of the Evidence Act. Sections 118 and 119 of the Evidence Act are contained within Pt 3.10 of the Evidence Act.
The Commission (and the State of New South Wales) submits that the legal professional privilege is overcome and/or vitiated by the fact that the information from the third person is information obtained contrary to the provisions of s 80 of the Act and the privilege does not apply.
In answer to such a proposition, the plaintiff submits that the provisions of s 80 of the Act are inconsistent with a law of the Commonwealth within the meaning of s 109 of the Constitution, including s 40 of the Crimes Act 1914 (Cth), insofar as they: impair the courts' capacity to provide for procedural fairness to parties in the position of the plaintiff and thereby impair the character of the court as an independent and impartial tribunal; impermissibly curtail the rights of plaintiffs to seek relief for unlawful executive conduct; impermissibly burden the implied freedom of communication on governmental and political matters in that the provision is not one which meets the proportionality test for legislation in pursuit of a legitimate aim of government.
It is appropriate to set out some basic factual framework upon which the foregoing submissions depend. It is an available inference, which inference the Court, as presently constituted and for present purposes only, draws, that the third person with whom the confidential communication has occurred is a former officer and/or employee of the Commission (JG).
The Court, as presently constituted, draws the inference on the material before it that the identity of the former officer/employee is JG. Nevertheless, it is possible (if not probable) that other persons could be involved or were involved in the communications to which reference has been made. Every one of those persons, at least inferentially, is a current or former officer or employee of the Commission.
While filed for various purposes, including the setting aside of a Notice to Produce that is no longer pressed, the Affidavits of Ms Gabrielle Drennan are irrefragable evidence rendering the drawing of such an inference inescapable. As a consequence, the Commission submits that the information and/or documents provided by the current or former staff of the Commission is a breach of s 80 of the Act.
Previously, the plaintiff has sought from the Commission or, more accurately, the Commissioner thereof, a direction pursuant to the terms of s 80(4)(c) of the Act that the information may be divulged (in this case information in the hands of the Commission) because "it is necessary in the public interest" for such information to be divulged. The request was refused.
Notwithstanding the refusal of the request under s 80(4) of the Act, no proceedings with which the Court is currently dealing seeks judicial review or the exercise of the supervisory jurisdiction of the Court in relation to that determination. Thus, to the extent that it is submitted that the provisions of s 80 "impermissibly curtails the rights of plaintiffs to seek relief … for unlawful executive conduct", there are no proceedings before the Court seeking such relief. Nor has it been suggested that such proceedings are sought to be commenced.
The Court has not, as yet, examined the material for which a claim for privilege is made. If, and I have no reason to doubt it, the description of the document in the schedule provided by the plaintiff is accurate, then, ordinarily, legal professional privilege would be maintainable in relation to each such document.
The issue then arises as to whether, in accordance with the submission of the Commission, that legal professional privilege is not maintainable as a result of the illegality associated with the breach of s 80 of the Act.
Under the common law there are "crime-fraud" exceptions to legal professional privilege, or its maintenance. The starting point for such an analysis is R v Cox and Railton (1884) 14 Q.B.D. 153, and in particular the judgment of Stephen J (at 167-169) in which his Honour remarked that privilege could not:
"include the case of communications, criminal in themselves, or intended to further any criminal purpose, for the protection of such communications cannot possibly be otherwise than injurious to the interests of and to those of the administration of justice. Nor do such communications fall within the terms of the rule. A communication in furtherance of a criminal purpose does not 'come into the ordinary scope of professional employment.'
…
In order that the rule may apply there must be both professional confidence and professional employment, but if the client has a criminal object in view in his communications with his solicitor one of these elements must necessarily be absent. The client must either conspire with his solicitor or deceive him. If his criminal object is avowed, the client does not consult his adviser professionally, because it cannot be the solicitor's business to further any criminal object. If the client does not avow his object he reposes no confidence, for the state of facts, which is the foundation of the supposed confidence, does not exist. The solicitor's advice is obtained by a fraud. To return to our former illustration. If A., proposing to forge a will, says to B., a solicitor, 'forge for me a will in the name of C.,' he asks B. to commit a crime which is not B.'s professional business. If he says, 'I am C., and I want you to make my will for me,' he reposes no confidence in B., but on the contrary, commits a gross fraud upon him."
It has been held that evidence obtained illegally for the purpose of litigation cannot be the subject of legal professional privilege: Dubai Aluminium Co Ltd v Al Alawi and Ors [1999] 1 WLR 1964. In the course of that judgment, Rix J (at 1969) said:
"But it seems to me that criminal or fraudulent conduct for the purposes of acquiring evidence in or for litigation cannot properly escape the consequence that any documents generated by or reporting on such conduct and which are relevant to the issues in the case are discoverable and fall outside the legitimate area of legal professional privilege."
The foregoing approach was approved by the English Court of Appeal in Memory Corporation Plc and Anor v Sidhu and Anor (No 2) [2000] 1 WLR 1443; Kuwait Airways Corpn v Iraqi Airways Co (No 6) [2005] 1 WLR 2734 and Imerman v Tchenguiz and Ors; Imerman v Imerman [2011] 2 WLR 592.
Thus, and applying those principles, if the evidence obtained from JG or another officer or former officer of the Commission was pursuant to a criminal act, then legal professional privilege would not apply to the communications under the common law.
In Dubai Aluminium Co Ltd v Al Alawi, the defendant sought copies of reports into the defendants' bank accounts prepared by investigators engaged by the plaintiff. The judicial officer found that there was criminal or fraudulent conduct in the obtaining of the information based upon legislation dealing with data protection and under Swiss banking laws and that, as a consequence, the fraud or iniquity exception to legal professional privilege applied. In this case, the breach of law was said to be in the provision of information contrary to the terms of s 80 of the Act. There is no distinguishing feature.
The plaintiff relies on the judgment of Kyrou J in Amcor Limited and Ors v Barnes and Ors [2011] VSC 341 at [50] in support of an argument that the privilege continues because the plaintiff was not "knowingly involved" in the commission of the breach of s 80 of the Act. The judgment in Amcor deals with s 125 of the Evidence Act with which the Court will deal shortly. The common law principle is as stated above.
Nevertheless, even on the comment of Kyrou J at [51], the position of JG and the existence of s 80 of the Act were both known to the solicitor then acting for the plaintiff and by the plaintiff and, as such, the conduct by the plaintiff and his solicitor was conduct "knowingly involved in the impugned conduct", namely, the breach of s 80 of the Act.
Further, to the extent that JG was, during some part of the time acting as the plaintiff's solicitor, then, during that time, JG was the plaintiff's agent and still caught by the exception as adumbrated by Kyrou J.
Given that the privilege arises, at this point in time, by virtue of the importing of Evidence Act privileges into the process of document discovery, production and access, it is appropriate to deal with the exception in the Evidence Act to the application of the privilege. While reference has been made to the provisions of s 122 of the Evidence Act, it seems that the provisions of s 122 are of little relevance in resolving the issues with which the Court is now concerned. More relevant are the provisions of s 125 of the Evidence Act.
Section 125 of the Evidence Act deals with the loss of client legal privilege by misconduct. There may be differences between the exception as it applies at the common law and that which is prescribed by s 125 of the Evidence Act.
In Australia, the foregoing common law position was held to apply and discussed at length, albeit in a slightly different context, in Attorney-General (NT) v Kearney [1985] HCA 60; (1985) 158 CLR 500, in which Gibbs CJ stated that "no Court can be called upon to protect communications which are in themselves part of a criminal or unlawful proceeding", citing, with approval, Bullivant v Attorney-General for Victoria [1901] AC 196 at 201.
Ultimately, it cannot be in the public interest for legal professional privilege to apply to a communication which itself is illegal. Whether that leads to the conclusion that legal professional privilege cannot apply to the communications between JG and the plaintiff or the plaintiff's solicitor depends upon the proper interpretation of s 80 of the Act, which has been previously discussed.
Turning then to the operation of s 125 of the Evidence Act, the provisions operate as an exemption to the exception otherwise contained in s 118 - s 120 of the Evidence Act which excludes legal professional privilege. Thus, s 125 operates to exempt communications described in s 125(1) from the exception to the admissibility of all relevant evidence (see s 55 and s 56 of the Evidence Act). Omitting irrelevant parts, s 125 of the Evidence Act prevents the operation of the privilege to a communication made in furtherance of the commission of an offence.
As has been stated on a number of occasions by the court (see Kang v Kwan [2001] NSWSC 698, per Santow J, as his Honour then was), s 125(1)(a) of the Evidence Act reflects and is based upon the common law and assistance may be derived from the cases decided thereunder.
Firstly, the relevant wording, extracted above, would render a communication which itself is illegal and subject to criminal penalty not privileged, when, as here, the party to whom the communication is made is aware of the facts and circumstances which give rise to the illegality. The privilege may not apply in other circumstances, but it is unnecessary to discuss it.
Secondly, once the party claiming legal professional privilege establishes, to the ordinary standard, the basis of that legal professional privilege, it is for the party seeking to utilise the exemption under the crime/iniquity provision in the common law or under s 125 of the Evidence Act to establish the circumstances that give rise to that exemption.
[4]
Consideration of the Privilege and Illegality
It is necessary to apply the principles associated with the privilege and the exemption from it to the circumstances of the current proceedings and the operation of s 80 of the Act. As earlier stated, giving the provisions of s 80 of the Act a purposive construction in which the legislature is intended to achieve harmonious goals, the ancillary powers of the Commission as a corporation, unrelated to the investigation of wrongdoing, the assembling of evidence and the dissemination of and/or reporting on such material, are not caught by the provisions of s 80 of the Act.
Thus, in the example used earlier in these reasons, a contract entered into by the Commission may be sued upon by a party outside of the Commission. In such a suit, documents relating to the formation of that contract and its terms may be the subject of production and the subject of access orders. Likewise, a conversation between an officer of the Commission (accepting fully that the Commission as a corporation acts through its officers, employees or agents) with the other contracting party is not the "communication of information" protected by s 80 of the Act.
Fundamentally, the substantive proceedings between the plaintiff and the Commission rely upon the existence of a contract (of some kind) between the plaintiff and the Commission. The Commission, it is said, engaged (by which term I include employment) the informant to provide information and agreed to terms and conditions for that engagement. The terms and conditions for that engagement are in dispute. Also in dispute is whether the Commission, at any stage, had an intention to create legal relations with the plaintiff.
Nevertheless, during the course of the "engagement" of the plaintiff, there would have been a communication between the plaintiff and an officer of the Commission of the fact or terms of that engagement. That communication is not the communication of "information" that would give rise to a criminal offence under s 80 of the Act. Apart from any other ground, such a communication would be for the purposes of, and authorised by, the Commission.
Nevertheless, in a suit, such as this, where the existence of a contract binding on the Commission and the plaintiff is in issue, the Commission is not able to hide behind the secrecy provisions and prevent the plaintiff from obtaining documents that go to the terms of any "engagement" or evidence which establishes (or otherwise) an intention to create legal relations.
Such material is not parol evidence. It falls within the category of evidence of communication going to the formation of a contract (if any) and the terms of such contract, if formed.
However, a communication which went to that which was to be investigated, or which will be investigated, or which was investigated and information obtained, is information covered by s 80 of the Act. Thus, a document, which identified persons to be investigated, or information obtained, with such particularity so as to compromise or to undermine the purposes of the Commission in carrying out its functions under s 10 of the Act, would not be privileged because the communication of such information would be contrary to s 80 of the Act.
A difficulty arises from the manner in which the privileges in the Evidence Act (and elsewhere) are imported into the Uniform Civil Procedure Rules. As earlier stated, the UCPR define a privileged document as a document containing privileged information. Further, privileged information is defined in accordance with the summary earlier provided. It would seem, on a strict reading of the UCPR, that all of a document containing any privileged information would be a privileged document and the Court would be unable to require its production or grant access to it.
I do not read the definition in that strict sense. However, it is necessary, in such circumstances, for the privileged information to be redacted, as a consequence of which the document would no longer contain privileged information and could be the subject of an order to produce and an order allowing a party access to the redacted document.
In those circumstances, the claim for legal profession privilege may or may not apply to some of the documents described in the schedule. Even though the plaintiff no longer presses its Notice to Produce, the provisions of s 80 of the Act do not apply to any document in the possession of the Commission that evidences only the conversations as between officers, employees or agents of the Commission and the plaintiff relating to the existence of a contract and its formation and, if formed, the terms of such contract. Given the current attitude of the plaintiff to its Notice to Produce, it is unnecessary to discuss the issue further.
Any detailed orders in relation to the claim for privilege made by the plaintiff must await inspection of the documents.
In light of the foregoing, it seems that the proposition that s 80 of the Act is inoperative because of s 73 or s 109 of the Constitution falls away. It may be that, if judicial review were before the Court, further limitations to the operation of s 80 of the Act would apply or the Court may need to determine whether s 138 of the Evidence Act applies to the production of documents. It is unnecessary to deal with the Constitutional issues further in these reasons.
[5]
Motion to Dismiss
Ultimately, all of these matters are discussed within the context of a motion on notice, filed by the defendant, to dismiss the proceedings as an abuse of process. That abuse of process depends, fundamentally, on the breach of s 80 of the Act that the Commission says is involved in the commencement of the proceedings. There may or may not be a breach of s 80 of the Act in the commencement of the proceedings. Whether such a breach has occurred and, if so, whether it is fundamental to the commencement of the proceedings or their future progress depends upon the terms of any communication.
Necessarily, the claim of the plaintiff depends upon the plaintiff's capacity to prove the existence of a contract that obliges the Commission to make payments in certain circumstances and the fulfilment of those circumstances. It is appropriate to reiterate the comments of Lord Diplock in Moschi v Lep Air Services Ltd; Lep Air Services Ltd v Rolloswin [1973] AC 331 at 346 - 347. While Moschi was a case on guarantees, his Lordship, after describing the "law of guarantee" as "part of the law of contract" said:
The law of contract is part of the law of obligations. The English law of obligations is about their sources and the remedies which the court can grant to the obligee for a failure by the obligor to perform his obligation voluntarily. Obligations which are performed voluntarily require no intervention by a court of law. They do not give rise to any cause of action.
English law is thus concerned with contracts as a source of obligations. The basic principle which the law of contract seeks to enforce is that a person who makes a promise to another ought to keep his promise. This basic principle is subject to an historical exception that English law does not give the promisee a remedy for the failure by a promisor to perform his promise unless either the promise was made in a particular form, e.g., under seal, or the promisee in return promises to do something for the promisor which he would not otherwise be obliged to do, i.e., gives consideration for the promise. …
Each promise that a promisor makes to a promisee by entering into a contract with him creates an obligation to perform it owed by the promisor as obligor to the promisee as obligee."
On the material currently before the Court, the Court is sceptical that any arrangement between the Commission and the plaintiff is one which gave rise to legal relations or, in other words, created obligations enforceable against the Commission or rights enforceable by the plaintiff. Nevertheless, in a motion to dismiss summarily, the issue is not whether it is likely that such an arrangement was made, but rather whether the proceedings are frivolous or vexatious, disclose no reasonable cause of action, or are an abuse of the process of the Court.
It cannot be said, on the face of the pleadings, that the proceedings are frivolous or vexatious. Further, given the injunction of the High Court in General Steel Industries Inc v Commissioner for Railways (NSW) [1964] HCA 69; (1964) 112 CLR 125 at 128 - 129, that the cause of action must be "so obviously untenable that it cannot possibly succeed", "manifestly groundless", "so manifestly faulty that it does not admit of argument", "discloses a case which the court is satisfied cannot succeed", or otherwise shows no good cause of action and would involve useless expense, the Court cannot dismiss it on the basis of the non-disclosure of a reasonable cause of action.
In this case, where the success of the proceedings and cause of action depends upon the evidence that may be adduced, such a course is not open to the Court. The Court must, on such an application accept the allegations in the Statement of Claim, despite its "scepticism" as to whether there was an intention to form legal relations or the obligations to which Lord Diplock referred in the passage above: see also Agar v Hyde [2000] HCA 41; (2004) 201 CLR 552; Spencer v Commonwealth of Australia [2010] HCA 28; (2010) 241 CLR 118 at [24].
As earlier stated, the formation of a contract of the kind asserted in the Statement of Claim may be unexpected, but it is arguable and depends upon a contest of fact that must be the subject of evidence and which the plaintiff is entitled to commence and with which he is entitled to proceed. Further, the communication upon which commencement of the proceedings depend, must, of necessity, be a communication to the plaintiff of information of which he is aware that was authorised. The evidence of JG is corroborative.
Lastly, the major submission of the defendant is that the proceedings are an abuse of process, because the proceedings depend upon a breach of s 80 of the Act. I have come to the conclusion that the successful resolution of the proceedings by the plaintiff does not depend upon a breach of s 80 of the Act, but, rather, on the adducing of evidence (some of which, no doubt, will be conversations between the plaintiff and officers of the Commission) as to the formation and terms of any arrangement under which, it is said, the plaintiff performed work.
Moreover, it cannot be said that the proceedings are brought for a purpose of achieving objects ulterior to that which is in the Statement of Claim and which forms the basis of the alleged cause of action, namely, damages for the non‑payment of what is said to be obligations of the Commission as to the payment to the plaintiff.
In those circumstances the motion for dismissal of proceedings as an abuse of process cannot succeed, at this juncture. I will hear the parties on costs and any other appropriate order to expedite the proceedings.
The Court makes the following orders:
1. Motion to dismiss the proceedings dismissed;
2. Legal professional privilege available for some documents in accordance with the reasons for judgment;
3. Detailed directions on the availability of legal professional privilege to be subject to further submissions and inspection by the Court.
[6]
Amendments
17 November 2016 - Typographical error in [86]
DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated.
Decision last updated: 17 November 2016