HRNG ADELAIDE, 4 October 1991 #DATE 5:11:1991 Counsel for Appellant: Mr. B.R. Hayes QC

with Mr. R. Proud Solicitors for Appellant: Finlaysons Counsel for Respondent Mitsubishi Australia Ltd. Mr. J.R. Sulan QC with Mr. W.L. Rudd Solicitors for Respondent Mitsubishi Australia Ltd. Corrs Chambers Westgarth Counsel for Respondent Piber Pty. Ltd. Mr. P.C. Heinrich Solicitor for Respondent Piber Pty. Ltd. Baker O'Loughlin

JUDGE1 MOHR J. On the 6th September 1988 at appellant's power station at Mintaro the rotor of a gas turbine generator was dropped to the ground and damaged during maintenance operations. The respondent was the contractor involved in the maintenance and lifting of the rotor. 2. The safety manual of the appellant provides for the reporting of accidents and for the establishment of Safety Committees. The manual makes clear however that it is not the function of Safety Committees to investigate accidents. Clause G11 so far as it is relevant reads:- "...It is not a function of safety committees to investigate accidents or to determine or classify causes of accidents. This is an executive responsibility to be carried out by the appropriate staff in the section in conjunction, where necessary, with Safety Branch or, in the case of serious accidents, by Committees of Enquiry appointed by Management. However, accident reports may be reviewed by safety committees for the purpose of suggesting ways to prevent the accident occurring again..." 3. Thus in the present case it was the function of the appellant's management to appoint a Committee of Enquiry to investigate and report on the subject accident. 4. It appears from the affidavits filed that the appellants had elected Messrs. Hoepner and Cock to investigate the accident. 5. It appears that simultaneously with the arrival of those gentlemen at the Mintaro Power Station at about 9 a.m. - 9.30 a.m. on the 7th September events were occurring in Adelaide which became relevant. 6. Mr. Groves who was, and still is, the appellant's manager, Risk and Insurance deposed that during the morning of 7th September he had become aware of the accident late in the afternoon of 6th September. The accident had happened at about 6 p.m. on that day according to an affidavit of Peter Robin Brown a consulting engineer employed by the respondent at the site. 7. On the morning of the 7th September Mr. Groves telephoned and spoke with Mr. Montgomery a partner in the firm of solicitors (Mouldens) who acted for the appellant. This was followed by a further telephone conversation between Mr. Montgomery and Mr. Eastham, then the Deputy General Manager of the appellant. The subject of both conversations was the accident of the previous afternoon at Mintaro. 8. Mr. Eastham sets out in his affidavit that he instructed Mr. Montgomery that he would be advising the appellant in relation to insurance and liability arising out of the accident. Mr. Montgomery requested that a Committee of Enquiry be established to prepare a report solely for the solicitors in relation to the issues of insurance and liability and for that purpose only. Mr. Montgomery also specified that only one copy of the resulting report was to be prepared. 9. This advice was confirmed by Mr. Montgomery by letter of the 7th September. The letter read:- "Attention: Mr. Eastham Dear Sir Re: Damage to Mintaro Gas Turbine We refer to our telephone conversations with you and Mr Groves this morning. The circumstances giving rise to the damage to the turbine are likely to result in claims by ETSA against its insurers and claims for recovery of ETSA's excess under its Industrial Asset Policy against the contractors and others involved in the enterprise which resulted in the damage to the turbine. As discussed we anticipate that ETSA will be involved in legal proceedings and for the purpose of advising ETSA as to its legal rights and remedies, we confirm that a Committee of Enquiry should be set up with a view to providing us with a full and complete report dealing with the cause and extent of the damage, the involvement of ETSA staff and contractors engaged in the enterprise, the contractual arrangements generally, activities associated with the maintenance of the turbine, and all other facts and information that may be relevant in respect of any claim by ETSA against its insurers of other parties. The report should include photographs of the scene, statements of witnesses, a collation of all relevant documentation and qualified opinions as to the cause of the loss and the extent of the damage. In addition, enquiries should be made as to the anticipated replacement or repair costs of the turbine, estimates as to any loss of revenue, and all other costs and expenses likely to be incurred by ETSA as a result of this incident. We further confirm that no other reports, notes or documentation (apart from material required for the purpose of the report to Mouldens) should be compiled or prepared. If, in the normal course of events, documents or reports would be prepared for purposes other than the obtaining of legal advice, then in the circumstances of this case, we confirm that, in our opinion, no such reports should be furnished or obtained. In order to retain privilege it must be understood that the Committee will prepare its report and associated documents solely for the purposes of obtaining legal advice. Any other documentation or reports will in all probability be subject to disclosure. We shall confer with you further regarding the terms of reference of the Committee. Yours faithfully" 10. Although it seems that Messrs. Hoepner and Cock had been despatched to Mintaro before these conversations and presumably as a Committee of Enquiry following the appellant's usual procedures it is equally clear from Mr. Eastham's affidavit that on the 7th September they were appointed to carry out the investigation requested by Mr. Montgomery. 11. Messrs. Hoepner and Cock continued their enquiry at Mintaro on 7th, 8th and 9th September and eventually produced the report headed "Report of Committee of Enquiry prepared on instructions of solicitors for ETSA". 12. This document was disclosed in an affidavit giving discovery and legal professional privilege was claimed for it. This claim was contested by the respondents and Debelle J. held after hearing argument and perusing the affidavits that legal professional privilege did not attach to the document in question. He also perused the report itself but I will return to that matter in due course. 13. The test as to whether or not legal professional privilege attaches to a document such as this is authoritatively laid out by the High Court in Grant v. Downs [1976] HCA 63; (1976) 135 CLR 674 in the joint judgment of Stephen, Mason and Murphy JJ. They said at pp 682-683:- "It has been accepted that documents brought into existence after an accident pursuant to a standing instruction previously given may be privileged (Collins v. London General Omnibus Co. (1893) 68 LT 831; The Hopper No. 13 (1925) P 25; Ankin v. London and North Eastern Railway Co. (1930) 1 KB 527, at p 536; Ogden v. London Electric Railway Co. (1933) 49 TLR 542; 149 LT 476.) Although to sustain the privilege it is not necessary that the document has been brought into existence on the advice of the solicitor, it is essential that the circumstances are such that the court can subsequently conclude, viewing them objectively, that litigation can be reasonably anticipated - see Feuerheerd v. London General Omnibus Co. Ltd. (1918) 2 KB 565; Cataldi v. Commissioner for Government Transport (1969) 1 NSWR 561; (1970) 1 NSWR 65, at p 68 - and this at the time when the preparation of the document is undertaken. However, the fact that the document is brought into existence in anticipation of litigation is not sufficient, without more, to attract privilege; the document must be called into being for use in litigation or for advice and it is the extent to which this purpose is intended to be served by the preparation of the document that is in question." and later at p 688:- "All that we have said so far indicates that unless the law confines legal professional privilege to those documents which are brought into existence for the sole purpose of submission to legal advisers for advice or for use in legal proceedings the privilege will travel beyond the underlying rationale to which it is intended to give expression and will confer an advantage and immunity on a corporation which is not enjoyed by the ordinary individual. It is not right that the privilege can attach to documents which, quite apart from the purpose of submission to a solicitor, would have been brought into existence for other purposes in any event, and then without attracting any attendant privilege. It is true that the requirement that documents be brought into existence in anticipation of litigation diminishes to some extent the risk that documents brought into existence for non-privileged purposes will attract the privilege but it certainly does not eliminate that risk. For this and the reasons which we have expressed earlier we consider that the sole purpose test should now be adopted as the criterion of legal professional

privilege." 14. The learned trial Judge in his judgment correctly found that Messrs. Hoepner and Cock were initially acting in accordance with the appellant's requirements of the Safety Instructions. He went on to say that no one in authority at the appellant's headquarters had authority to change the provision of the Safety Instructions. This may be so and in my opinion is beside the point in deciding whether or not the document in question was such that it attracted legal professional privilege. 15. The trial Judge went on to say:- "Although Messrs. Eastham and Groves suggest that the report has not yet been used for any other purpose other than the purpose of obtaining legal advice, there is nothing to indicate that it might not be used by the Trust on a later occasion for the purpose of taking steps to prevent recurrence of a like accident." 16. With all respect Messrs. Eastham and Groves did not suggest that the document had not been used for any other purpose than obtaining legal advice. They asserted the fact that that was its purpose and its sole use. 17. The fact that it was capable of filling another purpose in my opinion misconstrues the test laid down in Grant v. Downs (supra). In that case the reports had been brought into existence as a matter of routine by officers of the Department of Public Health for purposes other than obtaining legal advice. So much appears from the extract from the affidavit of Dr. Barclay which is set out on page 681 of the report. He listed the use to which the report could be put (in brief) as:- 1. Whether there had been breaches of discipline by staff. 2. To detect whether there had been faults in security in the general running of the institution. 3. Obtaining legal advice. 18. Such documents quite clearly did not satisfy the "sole purpose" test laid down in Nickmar Pty. Ltd. and another v. Preservatrice Skandia Insurance Ltd. 1985 3 NSWLR 44 per Wood J. At page 52 His Honour succinctly put the question to be asked and answered thus:- "The question it poses is simple, was the confidential communication, whether it be written or oral, created or made solely for the purpose of submission to legal advisers for advice, or for use in legal proceedings". On the authority of Grant v. Downs (supra) if the answer is, yes, then legal professional privilege attaches to the document or communication. 19. From my perusal of the affidavits in this matter it appears that whatever the position of Messrs. Hoepner and Cock may have been in the early stages of their investigation, from some time on 7th September until they completed their task and prepared that report they were engaged on the task assigned to them. That was, quite simply put, to investigate and prepare a report which was for the sole use of the appellant's legal advisers and for no other purpose. In my opinion it is beside the point to say that the report was capable of having another purpose. That may well be so but there is no evidence or suggestion that it has been or was ever intended to be used for any other that its stated purpose. It may be that Messrs. Hoepner and Cock could use the results of their investigations to advise the appellant on safety and other aspects of the accident but this does not, in my view, distract from the integrity of the only copy of the report forwarded to the appellant's solicitors for the purpose of obtaining legal advice. 20. The learned trial Judge perused the report and said it confirmed his opinion that it had a dual purpose. What he was really saying was that it was capable of serving a dual purpose but as I have said earlier that is nothing to the point when considering the purpose for which it was brought into existence. 21. I would allow the appeal.

JUDGE2 MATHESON J. The background to this appeal is set out in the other judgments, and I will only repeat it in so far as it is necessary to explain my decision. There will, however, be some duplication in quotations from affidavits and the exhibits thereto. It is convenient to mention here that none of the deponents were required to attend for cross-examination. 2. There is no dispute between the parties as to the relevant legal principles. I think it is sufficient for me to quote a passage from the joint judgment of Stephen, Mason and Murphy JJ. in Grant v. Downs [1976] HCA 63; (1976) 135 CLR 674 at pp 688-689: "All that we have said so far indicates that unless the law confines legal professional privilege to those documents which are brought into existence for the sole purpose of submission to legal advisers for advice or for use in legal proceedings the privilege will travel beyond the underlying rationale to which it is intended to give expression and will confer an advantage and immunity on a corporation which is not enjoyed by the ordinary individual. It is not right that the privilege can attach to documents which, quite apart from the purpose of submission to a solicitor, would have been brought into existence for other purposes in any event, and then without attracting any attendant privilege. It is true that the requirement that documents be brought into existence in anticipation of litigation diminishes to some extent the risk that documents brought into existence for non-privileged purposes will attract the privilege but it certainly does not eliminate that risk. For this and the reasons which we have expressed earlier we consider that the sole purpose test should now be adopted as the criterion of legal professional privilege. It is well accepted that the court in allowing production and inspection of documents exercises a judicial discretion. In so doing it needs to scrutinize with care claims of privilege made on the ground now under consideration. It is for the party claiming privilege to show that the documents for which the claim is made are privileged. He may succeed in achieving this objective by pointing to the nature of the documents or by evidence describing the circumstances in which they were brought into existence. But it should not be thought that the privilege is necessarily or conclusively established by resort to any verbal formula or ritual. The court has power to examine the documents for itself, a power which has perhaps been exercised too sparingly in the past, springing possibly from a misplaced reluctance to go behind the formal claim of privilege. It should not be forgotten that in many instances the character of the documents the subject of the claim will illuminate the purpose for which they were brought into existence." And a short passage from the judgment of Mason J. (as he then was) in National Employers' Mutual General Insurance Association Ltd. v. Waind [1979] HCA 11; (1979) 141 CLR 648 at p 654: "... the argument did not always make clear the distinction between the purpose for which information is obtained and the purpose for which a document recording information is brought into existence. It is the latter purpose with which the law of professional legal privilege is concerned." 3. Critical to the argument of the appellant is a letter from Mouldens dated 7 September, 1988, and apparently faxed to Mr. Eastham, the appellant's Deputy General Manager on that date at 1459 hours. It was obviously very carefully drafted by its author, Mr. D. W. Montgomery, and clearly indicates his familiarity with the relevant law: "Dear Sir Re: Damage to Mintaro Gas Turbine We refer to our telephone conversations with you and Mr Groves

this morning. The circumstances giving rise to the damage to the turbine are likely to result in claims by ETSA against its insurers and claims for recovery of ETSA's excess under its Industrial Asset Policy against the contractors and others involved in the enterprise which resulted in the damage to the turbine. As discussed we anticipate that ETSA will be involved in legal proceedings and for the purpose of advising ETSA as to its legal rights and remedies, we confirm that a Committee of Enquiry should be set up with a view to providing us with a full and complete report dealing with the cause and extent of the damage, the involvement of ETSA staff and contractors engaged in the enterprise, the contractual arrangements

generally, activities associated with the maintenance of the turbine, and all other facts and information that may be

relevant in respect of any claim by ETSA against its insurers or other parties. The report should include photographs of the scene, statements of witnesses, a collation of all relevant documentation and qualified opinions as to the cause of the loss and the extent of the damage. In addition, enquiries should be made as to the anticipated replacement or repair costs of the turbine, estimates as to any loss of revenue, and all other costs and expenses likely to be incurred by ETSA as a result of this incident. We further confirm that no other reports, notes or documentation (apart from material required for the purpose of the report to Mouldens) should be compiled or prepared. If, in the normal course of events, documents or reports would be prepared for purposes other than the obtaining of legal advice, then in the circumstances of this case, we confirm that, in our opinion, no such reports should be furnished or obtained. In order to retain privilege it must be understood that the Committee will prepare its report and associated documents solely for the purposes of obtaining legal advice. Any other documentation or reports will in all probability be subject to disclosure. We shall confer with you further regarding the terms of reference of the Committee. Yours faithfully, Mouldens." 4. The respondent put to the Court an argument based on a memorandum of the Deputy General Manager, Mr. Eastham dated 7 September, 1988 which read: "Mintaro Gas Turbine Rotor Damage Incident On 6 September 1988, during a heavy lift procedure, the rotor from the Mintaro gas turbine was dropped and considerable damage sustained. Our Solicitors (Mouldens) have requested that this incident be investigated. Accordingly, a committee of investigation comprising R J Hoepner and C Cock has been formed to carry out the necessary investigation. The terms of reference are: 1. to investigate the cause of the incident and the extent of damage; 2. to investigate the sequence of events leading up to the incident with respect to the actions of staff, contractors and operation of equipment; 3. to investigate the contractual arrangements and associated responsibilities concerning the planned Mintaro gas turbine maintenance activities; 4. to report on the adequacy of procedures and equipment; and 5. to produce a report on these matters by 16 September 1988 (J Eastham) DEPUTY GENERAL MANAGER" 5. The respondent's counsel drew the Court's attention to paragraph 4, and pointed out that it amounted to a term of reference that had not been mentioned in the letter from Mouldens. He argued that it indicated that the report was proposed for another purpose. However, I agree with Debelle J. that paragraph 4 does not "point strongly one way or the other". 6. The respondent referred the Court to the Safety Manual of the appellant dated November, 1987 which included the following under the heading "General Safety Section" (the emphasis is mine): 1) " G1 RESPONSIBILITY OF MANAGEMENT ... Management at all levels must ensure that all accidents are investigated, their causes found, that steps are taken to prevent a recurrence and that everybody who needs to be told about it is told. ..." 2) " G10 ACCIDENT REPORTING AND INVESTIGATION 10.1 - 10.2 ... 10.3 Damage Report All accidents involving property damage must be reported promptly. Form UF1155 'Damage Report' must be completed. 10.4 ...

10.5 Accident Investigation It is the responsibility of the supervisor to obtain a complete and detailed story of every accident as soon as possible and to see that the required reports are made. Every accident must be investigated to determine the cause and the steps needed to prevent a recurrence. Form UF1156 'Report of Injury to Employee' has been designed to assist supervisors to investigate accidents. Accidents not involving injury should be investigated as thoroughly as one involving injury." " Gll SAFETY COMMITTEES Safety Committees exist in all working areas of the Trust. Their objective must be to promote safety consciousness amongst all the employees in the particular section by generating ideas for safety awareness and safety programmes, and acting as an advisory group to the Branch or Departmental Head. Safety programmes can include local training sessions for all personnel involved. Outside assistance for these training sessions can be obtained from Safety Branch or Training Branch. It is important that the Committee be composed and conducted in such a way as to emphasise the importance that is placed on safety. Membership of a Safety Committee should include as many classifications from the work area covered by the Committee as possible including clerical classifications. Where practical two members of the same classification or section should be avoided. The Chairman shall normally be the most senior officer of the area, region, branch etc. Meetings must be held regularly, preferably monthly, and attendance by members must take preference over all other normal duties. It is not a function of safety committees to investigate accidents or to determine or classify causes of accidents. This is an executive responsibility to be carried out by the appropriate staff in the section in conjunction, where necessary, with Safety Branch or, in the case of serious accidents, by Committees of Enquiry appointed by Management. However, accident reports may be reviewed by safety committees for the purpose of suggesting ways to prevent the accident occurring again. It is important to ensure that the committee does not become a body to which complaints or reports about difficulties of deficiencies in material, equipment etc. are reported without them having first been reported to the supervisor concerned to avoid any delays in dealing with these matters. Remember, a hazard which exists now should be brought to attention immediately and not wait for a committee meeting before it gets corrected." 7. The respondent's counsel argued that neither Mr. Eastham nor the appellant's solicitors could waive the Manual's requirements for the accident to be investigated and for a damage report to be completed. We were informed that a Form VF 1155 and Damage Report was not discovered, and I think we can assume that in the light of advice from Mouldens, no such report was prepared. I notice that the Manual states that "in the case of serious accident ... Committees of Enquiry appointed by Management" investigate "serious accidents", and that is exactly what happened here. 8. When one examines the reasons of the learned Judge for rejecting the appellant's argument that the report was bought into existence for the sole purpose of obtaining legal advice, I consider the appellant's counsel has made good several criticisms. First, his Honour seems to give as one such reason his finding: " ... that Messrs. Hoepner and Cock had begun their enquiry not only before the decision was made to establish a Committee of Enquiry but also before Mr. Montgomery had given the advice to establish the Committee of Enquiry ..." 9. The only possible basis for any such finding are the affidavits of Peter Robin Brown, a consulting engineer then retained by the first respondent, who was present at the appellant's Mintaro power generating plant when the accident happened. His first affidavit dated 13 September, 1990 contains the following: "3. About an hour or so after the accident, a Mr Colin Richens of ETSA, who was in charge of the overhaul works, sent the site labour force home for the remaining working time of the day. I recall that he did so before the end of the normal working day. I recall that upon instructing the site labour force to leave for the day he also instructed them that they would be required to attend for work at the normal time the following day for the reason that they would be required for the purposes of an enquiry which would commence on the following day. Richens informed me that the ETSA enquiry would be conducted by Messrs Hoepner, Cock and, possible, a Mr A. Wauchope. 4. On 7 September 1988 Messrs Hoepner and Cock, both of whom were known to me, arrived at the Mintaro plant. I cannot recall the time of arrival precisely but I say that it was between about 9.00 am and 9.30 am. 5. ... 6. My engagement at Mintaro continued after the accident until such time as a replacement rotor had been obtained and installed and until the inspection and overhaul of the gas turbine had been completed. I say as follows: (a) After the accident the Plaintiff's internal enquiry took place at Mintaro on 7, 8 and 9 September 1988; ..." 10. In his second affidavit dated 21 November, 1990, Brown deposed, inter alia: "2. I say that the enquiry referred to in paragraphs 3 and 6 of my previous affidavit was conducted on 7, 8 and 9 September 1988 by Messrs. Hoepner and Cock of ETSA. 3. I recall that on 7 and 8 September 1988, Messrs Hoepner and Cock interviewed the members of the ETSA workforce who were engaged at Mintaro at the time of the overhaul job and the mishap, together with most of the personnel of outside contractors who had been engaged for that job. They interviewed approximately 12 or 13 persons over those two days. I cannot say how many persons were interviewed on the first day, namely 7 September 1988, but I do recall that interviews of a number of persons were undertaken on that day. 4. I was interviewed by Messrs Hoepner and Cock more than once, the first occasion being on 7 September 1988. I cannot recall the time of that interview. I recall that I was not the first person interviewed on that day but that I was amongst the persons who were interviewed earlier rather than later in the day." 11. With great respect, I do not think it was open to his Honour to make the finding he did, especially when one also considers the two affidavits filed by the appellant. The first affidavit was sworn by Ronald James Groves and is dated 17 October, 1990. At that time he was employed by the appellant as its Manager Risk and Insurance. His affidavit included the following: "2 On 6 September 1988 I was informed that earlier that day an incident occurred at ETSA's plant at Mintaro when the rotor of the gas turbine plant had been dropped from cranes which were lifting the said rotor from its housing and that the rotor appeared to have sustained substantial damage. 3 On the morning of 7 September 1988 I telephoned Mr D W Montgomery, a partner of Mouldens, solicitors for ETSA, and advised him of the incident and discussed the possibility of insurance and liability questions arising from such incident and that ETSA would require Mouldens' advice on those issues. Mr Montgomery requested that ETSA establish a Committee of Enquiry for the purpose that it should prepare a report to be presented to Mouldens solely for the purpose that legal advice could be provided to ETSA in relation to that issue. Mr Montgomery instructed me that only one copy of the report should be prepared and that no photocopies of the same should be taken at all." (Mr. Montgomery's letter was exhibited to the affidavit and Mr. Groves continued) "4 ... The said letter accurately records the advice which Mr Montgomery had given to me during our said telephone conversation. 5 On 7 September 1988 Mr J Eastham, the Deputy General Manager of ETSA, appointed a Committee of Enquiry to carry out the investigations and prepare a report in accordance with the request made by Mr Montgomery. 6 I am aware that the Committee of Enquiry undertook investigations in relation to the matter and subsequently prepared its report which was delivered to Mouldens. To the best of my knowledge no copies of the report were made and the report of the Committee of Enquiry has been used solely for the purpose of obtaining legal advice." 12. The other affidavit was sworn by Mr. Eastham and was dated 12 October, 1990. It contained the following: "2 On 7 September 1988 I learnt that on the previous day an incident had occurred at ETSA's plant at Mintaro when the rotor from the gas turbine had been dropped from cranes which were lifting the rotor from its housing and that the rotor appeared to have sustained substantial damage. 3 During the morning of 7 September 1988 I had a telephone conversation with Mr D W Montgomery, a partner of Mouldens, solicitors for ETSA, when I discussed with Mr Montgomery the incident relating to the damaged gas turbine rotor. Mr Montgomery informed me that earlier that morning he had a conversation with Mr R J Groves, ETSA's Manager Risk and Insurance, concerning the incident. During my conversation with Mr Montgomery I instructed him that he should advise ETSA in relation to insurance and liability issues arising out of the incident. Mr Montgomery requested that ETSA establish a Committee of Enquiry so that it may prepare a report solely for Mouldens to advise ETSA in relation to the issues and for that purpose only one copy of the report be prepared." (Mr. Motgomery's letter was exhibited to the affidavit and the Eastham continued.) 4 ... The said letter accurately records the advice which Mr Montgomery had given to me. 5 On 7 September 1988 I appointed a Committee of Enquiry to carry out the necessary investigations and to report to Mouldens for the purpose that Mouldens could advise ETSA in relation to the matter. 6 The Committee of Enquiry subsequently prepared its report which was delivered to Mouldens. To the best of my knowledge the report of the Committee of Enquiry has been used solely for the purpose of obtaining legal advice. I have no knowledge in relation to the matter since I left my employment with ETSA." 13. When these affidavits are carefully considered, it seems to me, with respect, that his Honour is wrong when he says "but there is nothing in any of the affidavits tendered on behalf of the Trust to show that the Trust does not regard the report as having the dual purpose of obtaining legal advice and complying with the requirements of para. 10.5." 14. Another reason given by the learned Judge for his decision was the following: "Although Messrs. Eastham and Groves suggest that the report has not yet been used for any purpose other than the purpose of obtaining legal advice, there is nothing to indicate that it might not be used by the Trust on a later occasion for the purpose of taking steps to prevent the recurrence of a like accident." 15. I agree with counsel for the appellant that if a report has been prepared solely for obtaining legal advice and results in legal professional privilege, the fact that the report at some subsequent stage is used for a different purpose does not effect the determination of the question of whether it was prepared for the sole purpose of obtaining legal advice. 16. Like the learned Judge, I have also inspected the report in question. I do not understand how his Honour could say that his inspection confirmed "that the report has a dual purpose". My inspection indicated to me that the Committee of Enquiry had faithfully followed Mr. Montgomery's careful advice. 17. I think the appellant discharged the relevant onus that it bore. I think it established that the report was brought into existence solely for the purpose of legal advice. 28. I would allow the appeal.

JUDGE3 ZELLING A.J. The appellant Trust was in September 1988 effecting considerable maintenance work on a gas turbine generator at its Mintaro power station. 2. Included in the work was the dismantling of a rotor forming part of the generator. 3. The work was being done by contractors. On 6 September 1988, whilst the rotor was being lifted by crane from its housing, it fell to the ground and sustained substantial damage. 4. The Trust is suing its contractors for negligence which it is said caused the damage. 5. The Trust had a report prepared by members of its staff in relation to the damaged rotor. It says the report is privileged from disclosure on the ground of legal professional privilege. The claim of privilege is disputed by the first and second defendants and the disputed claim was heard by a Judge of this Court. He held that the report did not attract privilege and an appeal from his decision has been brought by leave to the Full Court. 6. The learned Judge described the appellant Trust's standing procedures in case of accident as follows:

"The Trust has prescribed standing procedures to be observed whenever an accident occurs. They are contained in Part G10 of the General Safety Section of the Trust's Safety Manual. Part G10 stipulates that all accidents involving personal injury and damage to property must be both reported and investigated. The procedure for investigating accidents is set out in para.10.5 of part G10. It provides: 'It is the responsibility of the supervisor to obtain a complete and detailed story of every accident as soon as possible and to see that the required reports are made. Every accident must be investigated to determine the cause and the steps needed to prevent a recurrence. Form UF 1156 "Report of Injury to Employee" has

been designed to assist supervisors to investigate accidents. Accidents not involving injury should be investigated as thoroughly as one involving injury.' The Safety Manual defines 'must and shall' to mean 'it is obligatory'. The Trust's concern for safety which emerges from the Safety Manual is emphasised by this obligatory requirement to investigate accidents. Plainly the investigation of accidents is one of the necessary steps to be taken to enable the Trust to put in train measures to seek to prevent any recurrence. The investigation of accidents is not simply a routine procedure but a mandatory requirement to be observed whenever an accident occurs. There is nothing which empowers any officer of the Trust to waive the requirements of

para.10.5. Instead, part G1 of the Manual which deals with the responsibility of management for safety states: 'Management at all levels must ensure that all accidents are investigated, their causes found, that steps are taken to prevent a recurrence and that everybody who needs to be told about it is told.' Investigation of the accident at the Mintaro power station on 6 September 1988 would, therefore, have been required as part of the standard procedures of the Trust." 7. The Judge found the facts relating to the setting up of the enquiry to be as follows: "Mr Colin Richens was, in September 1988, a plant engineer employed by the Trust. He was the plant engineer at the Mintaro power station. Approximately one hour after the accident and before the end of the working day, Mr Richens told the Trust's employees at the Mintaro power station that they were no longer required for that day. He asked the employees to return the next day. He informed them that an enquiry into

the accident was to begin on the following day and that they would be required to give evidence to the enquiry. On 6

September, Mr Richens also informed Mr Brown, a consultant engineer retained by the first defendant, who was present at

the power station on that day, that the Trust would be conducting an enquiry into the accident. He told Mr Brown that

the enquiry would be conducted by Messrs Hoepner and Cock, adding that it was possible that a Mr Wauchope might also be

involved in the conduct of the enquiry. At some time between 9.00 and 9.30 in the morning of 7 September, Messrs Hoepner and Cock arrived at the Mintaro power station and began to conduct the enquiry. The enquiry continued on 8 and 9 September. In the course of the enquiry, Messrs Hoepner and Cock made tape recordings and took photographs. They were also given some photographs by Mr Brown that he had taken of the lifting operation. Mr Brown was interviewed by Messrs Hoepner and Cock as part of the enquiry. Mr Brown told them that he had earlier advised the Trust that, for the purposes of the lift of the rotor of the gas turbine, it should engage a suitably qualified and experienced rigging specialist, and that the Trust had declined to accept his advice." 8. As a result the appellant's employees Hoepner and Cock prepared the report the subject of this appeal. 9. The learned Judge found the facts with relation to the privilege claim to be as follows: "I turn to the facts on which the claim for privilege is founded. It appears that the accident was reported on 6 September 1988 to Mr Groves. Mr Groves was employed by the Trust as its Manager, Risk and Insurance. On 6 September, he was informed that earlier on that day the accident had occurred at Mintaro. On the morning of 7 September he telephoned the Trust's solicitors, Mouldens, and spoke to Mr Montgomery, one of the partners. He informed Mr Montgomery of the accident. He discussed with Mr Montgomery the possibility that insurance and liability questions might arise from the accident and sought advice. He says that Mr Montgomery asked the Trust to establish a Committee of Enquiry for the purpose of preparing a report to be presented to Mouldens. Mr Groves says that the report was solely for the purpose of enabling Mouldens to provide legal advice to the Trust in relation to the accident. He says also that Mr Montgomery instructed him that one copy only of the report should be prepared and that no photocopies of the report should made. Later, on that same morning, the Deputy General Manager of the Trust, Mr Eastham, also had a telephone conversation with Mr Montgomery concerning the accident. Mr Montgomery gave Mr Eastham the same advice he had given earlier in the morning to Mr Groves. Later in the day Mouldens wrote to the Trust a letter which, both Mr Groves and Mr Eastham say, accurately records the advice Mr Montgomery had given them. The letter written to the Trust by Mouldens was addressed to Mr Eastham. The letter is in the following terms: 'The circumstances giving rise to the damage to the turbine are likely to result in claims by ETSA against its insurers and claims for recovery of ETSA's excess under its Industrial Asset Policy against the contractors and others involved in the enterprise which resulted in the damage to the turbine. As discussed we anticipate that ETSA will be involved in legal proceedings and for the purpose of advising ETSA as to its legal rights and remedies, we confirm that a Committee of Enquiry should be set up with a view to providing us with a full and complete report dealing with the cause and extent of the damage, the involvement of ETSA staff and contractors engaged in the enterprise, the contractual arrangements generally, activities associated with the maintenance of the

turbine, and all other facts and information that may be relevant in respect of any claim by ETSA against its insurers

or other parties. The report should include photographs of the scene, statements of witnesses, a collation of all relevant documentation and qualified opinions as to the cause of the loss and extent of the damage. In addition, enquiries should be made as to the anticipated replacement or repair costs of the turbine, estimates as to any loss of revenue, and all other costs and expenses likely to be incurred by ETSA as a result of this incident. We further confirm that no other reports, notes or documentation (apart from material required for the purpose of the report to Mouldens) should be compiled or prepared. If, in the normal course of events, documents or reports would be prepared for purposes other than the obtaining of legal advice, then in the circumstances of this case, we confirm that, in our opinion, no such reports should be furnished or obtained. In order to retain privilege it must be understood that the Committee will prepare its report and associated documents solely for the purposes of obtaining legal advice. Any other documentation or reports will in all probability be subject to disclosure.' Mr Eastham says that, in accordance with the advice he had received, he appointed the Committee of Enquiry and that the Committee of Enquiry comprised Messrs Hoepner and Cock. The terms of reference of the Committee of Enquiry were: '1. to investigate the cause of the incident and the extent of damage; 2. to investigate the sequence of events leading up to the incident with respect to the actions of the staff, contractors and operation of equipment; 3. to investigate the contractural arrangements and associated responsibilities concerning the planned Mintaro gas turbine maintenance activities; 4. to report on the adequacy of procedures and equipment; and 5. to produce a report on these matters by 16 September 1988.' Mr Eastham says the report was used solely for the purpose of obtaining legal advice. However, at a date, which is not disclosed, Mr Eastham had left the employ of the Trust to take up another appointment. As he says in his affidavit, he has no knowledge of the matter since he left the Trust. Mr Groves says that the report has been used only for the purpose of obtaining legal advice." 10. After setting out the sole purpose test established by the High Court of Australia in Grant v. Downs [1976] HCA 63; (1976) 135 CLR 674 and followed in many later cases, and detailing the respective arguments of the parties, his Honour went on: "There can be little doubt that the Trust's solicitors did request the preparation of the report, that the report was to be used for the purpose of enabling the Trust to obtain legal advice, that it was reasonable for the Trust and its solicitors to anticipate that the accident might result in legal proceedings, and that the report was supplied to the Trust's solicitors. To this must be added the statements of Messrs Groves and Eastham that the report has not been used for any purpose other than to obtain legal advice. But there is nothing in any of the affidavits tendered on behalf of the Trust to show that the Trust does not regard the report as having the dual purpose of obtaining legal advice and complying with the requirements of para.10.5. Further, regard must be had to the objective facts as well as to the assertions made by the officers of the Trust. Several facts point to the conclusion that Messrs Hoepner and Cock were initially acting in accordance with the Trust's requirement in para.10.5 that all accidents must be investigated namely, the fact that it is a compulsory requirement of the Trust to investigate all accidents 'to determine the cause and the steps needed to prevent recurrence'; the fact that Messrs Hoepner and Cock had begun their enquiry not only before the decision was made to establish a Committee of Enquiry but also before Mr Montgomery had given the advice to establish the Committee of Enquiry; the fact that the Safety Manual does not invest any officer of the Trust with the power to waive the requirements of para.10.5; and the fact that it is not suggested by the Trust that either Mr Eastham or Mr Groves had any authority to alter the standing instruction in para.10.5: cf Aydin v. Australian Iron and Steel Pty Ltd (1984) 3 NSWLR 684, 685. Where a person is preparing a report which is intended for a particular purpose, it is no doubt possible to change the purpose for which the report is intended to be used before the report has been completed. But the affidavits tendered on behalf of the Trust do not show any change in the purpose of the report nor do they prove any authority in either Mr Groves or Mr Eastham to alter the requirements in para.10.5. Although Messrs Eastham and Groves suggest that the report has not yet been used for any purpose other than the purpose of obtaining legal advice, there is nothing to indicate that it might not be used by the Trust on a later occasion for the purpose of taking steps to prevent recurrence of a like accident. For these reasons I am not satisfied that the report was not brought into existence for the purpose of satisfying both the obligatory requirement in para.10.5 to investigate accidents and for the purpose of obtaining legal advice. In other words, I am not satisfied that the sole purpose for bringing the report into existence was the purpose of obtaining legal advice or for use in legal proceedings. The report should therefore be produced for inspection by the other parties to the action." 11. The Judge said he had inspected the report and it confirmed his views on the topic. He then dealt with other claims for privilege which have been resolved and are not before us. 12. Mr Hayes QC who led for the appellant Trust, accepted that the legal test of privilege was the sole purpose test set out in Grant v. Downs (supra), and did not challenge the Judge's finding that the onus of establishing that the report was privileged rested on his client. 13. He asserted that what the appellant did was sufficient to demonstrate that the sole purpose of obtaining the report was that of the obtaining of professional advice by the Trust and that the learned Judge had misunderstood the evidence in coming to his conclusions. 14. It was accepted by both sides that the fact that the enquiry was commenced prior to E.T.S.A. obtaining advice from its solicitors was not decisive, because it could have carried on the enquiry from the time of receiving the advice, on the basis that the sole purpose thereafter of the report following the enquiry was to obtain legal advice thereon. 15. The learned Judge did not think that that was what occurred. 16. There is no doubt that if E.T.S.A. had followed Mr Montgomery's wise advice literatim, it would have achieved its purpose. That would have involved setting up a new enquiry for the purpose of getting legal advice, and letting the current enquiry continue on its way to produce a report to comply with the Trust's Safety Manual. That did not happen. 17. The Judge found there was nothing in any of the affidavits tendered on behalf of the appellant to show that the appellant did not regard the report as having the dual purpose of obtaining legal advice and complying with the requirements of the Trust's Manual. 18. That means there was a multiple purpose, one of which purposes did not fall within the protection, and the privilege does not attach: see the judgment of Mason J. (as he then was) in National Employers' Mutual General Insurance Association Ltd v. Waind [1979] HCA 11; (1979) 141 CLR 648 at 656-7. That judgment was concurred in by the other members of the High Court. 19. The instant case is close to the line. However, the onus was on the appellant to prove the privilege and I am not persuaded at the end of the day that the learned Judge fell into error in holding that the onus was not discharged. The appeal should be dismissed. 20. For the sake of completeness, in case this matter falls to be considered elsewhere, I have not dealt with the alternative possibility that at least the actual observations of fact of the persons compiling the report, as distinct from the collation of the observations and their deductions and recommendations, were not outside the ambit of the privilege. The cases are old and their parameters difficult to define. I refer to the judgment of Menhennitt J. in Re Stanhill Consolidated Ltd [1967] VicRp 92; (1967) VR 749 at 751 and to Gillies on Evidence 2nd Ed. p 440. We did not hear argument directed to the point and I do not decide it.