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[2015] QIRC 35
Queensland Industrial Relations Commission
2015-03-03
Original judgment source is linked above.
INDUSTRIAL LAW - APPLICATION FOR FURTHER AND BETTER DISCLOSURE - Whether investigation report prepared by lawyers is protected by legal professional privilege - Application for further and better disclosure allowed in part.
Bartolo v Doutta Galla Aged Services Limited [2014] FCCA 1517
Commissioner of Australian Federal Police v Propend Finance Pty Ltd (1997) 188 CLR 501
Esso Australia Resources Ltd v Commissioner of Taxation [1999] HCA 67; (1999) 201 CLR 49
Grant v Downs [1976] HCA 63; (1976) 135 CLR 674
Price Waterhouse v BCCI Holdings (Luxembourg) SA [1992] BCLC 583
Re Highgrade Traders Ltd [1984] BCLC 151
Sydney Airports Corporation Ltd v Singapore Airlines Ltd & Qantas Airways Ltd [2005] NSWCA 47
Dr M. Spry, of Counsel, instructed by Avant Law, for the Applicant.
Mr M. Hinson, of Queen's Counsel, with him Mr C Murdoch of Counsel instructed Clayton Utz for the Respondent.
[1] Dr Wirth (the "applicant") was employed by the Mackay Hospital and Health Service (the "respondent") pursuant to a contract of employment as a Senior Medical Officer.
[2] The respondent commenced a show cause process under its disciplinary policy in relation to Dr Wirth's conduct. Ten allegations of misconduct were included in a show cause notice dated 9 October 2014. Further particulars were provided to the respondent on 31 October 2014.
[3] The applicant was invited to and did respond to the show cause notice.
[4] On 4 December 2014 disciplinary findings were made and disciplinary action was identified. The applicant was invited and did respond to both the disciplinary findings and the proposed disciplinary action.
[5] The Applicant's employment was terminated on 6 January 2015.
[6] Pursuant to clause 25 of his contract of employment, Dr Wirth may appeal a decision to terminate his employment to the Director-General who must then request a Deputy President of the Queensland Industrial Relations Commission (the Commission) be appointed to arbitrate the appeal.
[7] On 30 January 2015, the respondent filed and served on the applicant a list of documents in accordance with directions made by the Vice President on 15 January 2015.
[8] The application seeks the following orders for further and better disclosure as set out below:
"That the applicant (sic) supply to the respondent (sic) within seven (7) days of this order a copy of the following documents:
[9] The applicant relies on the Application for Further and Better Particulars filed in the Industrial Registry on 16 February 2015 and the supporting affidavit of Sonya Lee Black sworn on 16 February 2015.
[11] The applicant seeks the production of the investigation report, witness statements or transcripts of witness interviews arising out of the investigation into the Emergency Department of Mackay Hospital and Health Service referred in Dr David Farlow's email to the applicant dated 15 September 2014.
[12] The respondent asserts that no investigation report was created and that the other evidence sought be the applicant is the subject to a claim of legal professional privilege. A "Legal Advice Report" was prepared by Clayton Utz. However it is argued that this report is protected by legal professional privilege on the basis that the solicitors were engaged to conduct an independent investigation into the Emergency Department at Mackay Hospital and provide advice. Therefore, the items identified in the application are protected and not disclosable.
[13] Barwick CJ, in Grant v Downs[1]
"Having considered the decisions, the writings and the various aspects of the public interest which claim attention, I have come to the conclusion that the Court should state the relevant principle as follows:
a document which was produced or brought into existence either with the dominant purpose of its author, or of the person or authority under whose direction, whether particular or general, it was produced or brought into existence, of using it or its contents in order to obtain legal advice or to conduct or aid in the conduct of litigation, at the time of its production in reasonable prospect, should be privileged and excluded from inspection." [2]
[15] In the email of Dr David Farlow to the applicant dated 15 September 2014[5] it was stated:
"As part of the process of identifying these communication and relationship break-downs, the Service is conducting an independent investigation into the Emergency Department and has engaged Clayton Utz solicitors to conduct this investigation and provide advice."
[16] Earlier in the email, the applicant was advised that he was suspended from duty pursuant to s 137 of the Public Service Act. He was advised that he was not suspended as part of a disciplinary suspension but rather on the basis that the efficient management of the Emergency Department could be prejudiced if you were not suspended or temporarily removed from the workplace. In forming that view, it was identified that there had been a break-down in communication and working relationships amongst staff (including the applicant) in the Emergency Department.
[17] It was the applicant's submission that he had been told by Dr Farlow that the applicant's participation was sought in an independent investigation into the communication breakdowns in the Emergency Department at Mackay Hospital.
[18] It was the contention of the applicant that there is no privilege in a communication by a lawyer where the lawyer is acting in a non-legal capacity. It was argued that the work undertaken by Clayton Utz in investigating a communication breakdown in the Emergency Department at Mackay Hospital was not work for which one must be legally qualified.
[19] The applicant referred the Commission to the Bartolo v Doutta Galla Aged Services Limited[6] where Whelan J at [77] and [78] wrote:
'Ordinarily a letter from a professional legal adviser will be written only in his character as such and only for the purpose of furnishing professional legal advice. The cases where such scrutiny [in determining the purpose for which the document was created] will ordinarily be necessary are cases like the present where a letter is or may be written in one or both of two capacities: e.g., a letter written to the secretary of a company by a person who is both a director of the company and the company's solicitor.'"
[20] In the email of Dr Farlow to the applicant dated 15 September 2014 the following is said:
"As you have been previously advised, your suspension was not undertaken on a disciplinary basis. The decision to suspend you on full pay was undertaken under s. 137 of the Public Service Act, which is not a disciplinary suspension power. At the time of your suspension, Danielle, as the acting Chief Executive of the Service, formed the view that the proper and efficient management of the Emergency Department could be prejudiced if you were not suspended or temporarily removed from the workplace. In forming that view, it was identified that there had been a break-down in communication and working relationships amongst staff (including yourself) in the Emergency Department. So your suspension was not undertaken as a disciplinary measure but rather as one of the measures available to the Service to assist in the process of identifying the cause of these break-downs. As you would expect, it is critical that the service have the opportunity to investigate these issues so that the relevant steps can be identified and appropriately dealt with going forward for the safety of our patients and the proper and efficient management of the Service."
[21] Dr Farlow, after setting out the above background continued:
"As part of the process in identifying these communication and relationship break-downs, the Service is conducting an independent investigation into the Emergency Department and has engaged Clayton Utz solicitors to conduct this investigation and provide advice. Clayton Utz has interviewed a broad range of staff across the Emergency Department and would now like to interview you in your capacity as a member of the Emergency Department. Your participation in this process via an interview with Clayton Utz is important as it will assist the Service to identify and understand the issues causing the communication and relationship break-downs."
[22] The purpose for which a document is brought into existence is to be determined at the time at which it is commissioned and not by reference to purposes to which it may later be applied.[7]
[23] The burden of proof, to prove existence of privilege, rests on the party claiming it.
[24] In Sydney Airports Corporation Ltd v Singapore Airlines Ltd & Qantas Airways Ltd[8], an aircraft owned by Singapore Airlines Ltd was damaged when an aerobridge, operated by Qantas Airways Ltd, malfunctioned. Singapore Airlines commenced proceedings against Sydney Airports Corporation Ltd, Qantas, and the aerobridge's maker. A report into the incident was commissioned by Ms Jane Wilder, an in-house solicitor of SACL, from Peter Reardon Enterprises Pty Ltd. Sydney Airports Corporation Ltd claimed the report was privileged. Singapore Airlines and Qantas contested the claim.
"The evidence that the report was always to be deployed for non-privileged purposes, which purposes were of significance to the Claimant - particularly to have the aerobridge back in service - was such that although the privileged purpose may have been the most important single factor, it was not shown to be dominant. Accordingly, his Honour was correct to conclude that the Claimant failed to discharge its onus."[9]
[26] In Price Waterhouse v BCCI Holdings (Luxembourg) SA[10], Millett J wrote:
"The board of BCCI, the auditors, and the regulatory authorities all needed to know what was the true financial position of BCCI, and this required an investigation in order to establish the facts. If BCCI itself or its controlling shareholders did not set an investigation in motion, it was feared that the regulatory authorities would. BCCI's financial position depended, in part at least, on the recoverability of the problem loans and that might require legal advice as to the prospects of success if resort had to be made to legal proceedings. But just as in Waugh v British Railways Board the board needed to establish the facts whether or not litigation ensued, so the board of BCCI, the auditors and the controlling shareholders needed to establish BCCI's financial position whether or not recovery proceedings were necessary.
Given that the dominant purpose of the investigation was to establish the facts necessary to enable BCCI's financial position to be determined, documents brought into existence in the course of the investigation did not in my judgment attract legal professional privilege merely because legal advice might be necessary in order fully to evaluate the financial implications of the facts. The obtaining of legal advice is not an end in itself. To attract privilege it must be for the purpose of actual or contemplated proceedings."[11]
[27] In Re Highgrade Traders Ltd[12] a claim to privilege was raised in respect of reports obtained by insurers who were suspicious of the circumstances attending a fire on the premises of their insured. At first instance, the court rejected the claim for privilege on the basis of duality of purpose. However, the Court of Appeal overturned the decision on the basis that that the purposes were "quite inseparable". Oliver LJ said:
"What, then, was the purpose of the reports? The learned judge found a duality of purpose because, he said, the insurers wanted not only to obtain the advice of their solicitors, but also wanted to ascertain the cause of the fire. Now, for my part, I find these two quite inseparable. The insurers were not seeking the cause of the fire as a matter of academic interest in spontaneous combustion. Their purpose in instigating the inquiries can only be determined by asking why they needed to find out the cause of the fire. And the only reason that can be ascribed to them is that of ascertaining whether, as they suspected, it had been fraudulently started by the insured. It was entirely clear that, if the claim was persisted in and if it was resisted, litigation would inevitably follow."[13]
[28] In the present case it was necessary for the respondent to determine the extent of the problem in the Emergency Department of the Mackay Hospital. Thereafter, it may be necessary to obtain legal advice. But, in my view, the two purpose were quite independent of each other. There was nothing, to use the words in Re Highgrade Traders "of merely academic interest" in the investigation of the Emergency Department; it was of vital importance to the respondent to determine the cause of the problems.
[29] My conclusion is influenced by the fact that the applicant was not stood down on the basis of any impending disciplinary proceeding but rather was stood down in reliance of s 137 of the Public Service Act. Section 137 relevantly provides that:
[30] The report was commissioned, in my view, for the purpose of identifying the communication and relationship break-downs so that steps could be identified and taken to address the problem "for the safety of our patients and the proper and efficient management of the Service." I am further satisfied that this was the dominant purpose of the investigation, and was quite independent of the possible need to take disciplinary or other proceedings. Accordingly, the documents in question do not attract legal professional privilege.[14]
[31] Whilst concluding that the report is not protected by legal professional privilege, I acknowledge that there may be arguments raised as to relevance. In any event, that is an issue which can be dealt with between the parties or, if necessary, by a further application to the Commission.
[32] The memorandum of 3 December 2014 from Dr Farlow to Clare Douglas identified the key documents provided to her for her consideration. The letter of Clayton Utz dated 4 February 2015 states "Accordingly, we are instructed that subject to the matters the subject of legal professional privilege our client has provided you with the documents it has relied on in making the decision to terminate Dr Wirth's employment."
[33] With the exception of the Legal Advice Report prepared by Clayton Utz and the subject of the claim for legal professional privilege, the applicant has not satisfied me that there remains undisclosed material upon which the decision maker relied. In the absence of anything to the contrary, I am not prepared to make the order that is sought.
[34] The applicant seeks the disclosure of a limited number of patient records in relation to allegations 3(b)(ii), 5(b), 6(e)(i), 6(f), 8(b)(i), and 9(b).
[35] It is submitted that production of these patient records are necessary as the allegations raised in the show cause notice call into doubt the applicant's clinical competence. It is the applicant's contention that the allegations are serious and some of them have been substantiated. Therefore, it is argued the documents are relevant to the proceedings before the Commission and ought to be produced.
[36] The respondent argues that the applicant has been consistently told that his clinical competencies and judgment are not in issue.
[37] In the decision of disciplinary action dated 6 January 2015, Ms Douglas wrote:
"I acknowledge that you are a skilled emergency medicine specialist and that no adverse clinical findings have been made against you."
[38] Allegation 3(b) was not substantiated and consequently the patient records are not relevant to the proceedings before the Commission. Equally, allegation 6(e)(i) was also not substantiated and for the same reason as above the patient records need not be disclosed.
[39] Allegation 5(b) specifically relates to the applicant's failure to inform Ms Alta Neethling that he was going to sedate a patient. I accept the submission of the respondent that there is nothing before the Commission to indicate that the production of the patient's medical records would be relevant to the question whether or not the applicant failed to communicate information necessary for a colleague to safely perform their duties, in particular, that he was going to sedate a patient.
[40] Allegation 6(f) alleged that the applicant engaged in inappropriate communication with a patient, in particular:
On an unknown date whilst treating a 70 year old patient who was suffering from chronic obstructive pulmonary disease, you shouted at him words to the effect "don't yell like that", "don't behave like that" and "calm down". The patient was accompanied by his neighbour who explained to you that this was not his usual behaviour. Your response to the neighbour was words to the effect that "did I speak to you at all?", "why are you here?", and "I didn't talk to you".
[41] It was the respondent's contention that the request for the patient records amounted to a fishing expedition and there production was not relevant to the matter to be determined. I agree.
[42] In relation to allegations 8(b)(i) and 9(b) I am of the view that the request for the patient records amounts to a fishing expedition and there production is not relevant. Allegation 8(b)(i) relates to poor supervisory skills as a Senior Medical Officer. Allegation 9(b) relates to inappropriate treatment of a junior colleague, namely Dr Galletly and lack of supervision. Having regard to the nature of the allegations, the medical records would not assist in the determination of the issues before the Commission.
[43] In Re Clerks' (Alcoa of Australia - Mining and Refining) Consolidated Award 1985[15], Munro J examined the principles which should be adopted in the Australian Industrial Relations Commission when considering whether to issue an attendance notice or to set one aside under r 61, IRTR said:
"The documents sought must be of a nature capable of being relevant to an issue which might legitimately arise on the hearing of the matters in dispute. In the first instance the documents are produced to the tribunal upon whom it falls to examine the documents, assess their relevance and determine what access by the parties to the documents may be appropriate ... A party will not be required to produce documents where to do so would be oppressive; or where the demand for production is a 'fishing expedition', in the sense that it is an endeavour not to obtain evidence to support a case, but to discover whether there is a case at all. Where the proper use of legal compulsion to produce documents is in issue, the tribunal will need to carry out an exercise of judgment upon the particular facts in each case. That judgment requires a balance on the one hand of the reasonableness of the burden imposed upon the recipient, and of the invasion of private rights, with on the other hand, the public interest in the due administration of justice and in ensuring that all material relevant to the issues be available to the parties to enable them to advance their respective cases."[16]
[44] For the reasons advance above, I do not propose to grant the orders sought in relation to the disclosure of a limited number of patient records in relation to allegations 3(b)(ii), 5(b), 6(e)(i), 6(f), 8(b)(i), and 9(b).
[45] The applicant seeks the disclosure of the diary of the decision maker, Ms Clare Douglas, for 3 and 4 December 2014 and 5 and 6 January 2015.
[46] The applicant, in my view, has failed to demonstrate how the disclosure of the diary for the stated periods could be said to be relevant to the matters in dispute.
[47] I accept the respondent's argument that the diary of Ms Douglas is not relevant and is a fishing exercise. Accordingly, I am not prepared to grant the order sought.
[48] This part of the application seeks the unredacted copies of the memos from Dr David Farlow to the decision maker, Clare Douglas, dated 3 December 2014 and 5 January 2015.
[49] The memoranda contain recommendations which the respondent submits are protected by legal professional privilege.
[50] The applicant maintains that the recommendations outlined in the memoranda contain material that is relevant to the proceedings. The applicant further submits that the recommendations contributed to Ms Douglas' decision making.
[51] Having had the opportunity of considering the redacted memoranda and in light of my conclusion that the legal advice report does not attract legal professional privilege, I would order that unredacted copies of the memoranda from Dr David Farlow to the decision maker, Clare Douglas, dated 3 December 2014 and 5 January 2015 be disclosed to the applicant.
[1] Grant v Downs [1976] HCA 63; (1976) 135 CLR 674.
[2] Grant v Downs [1976] HCA 63; (1976) 135 CLR 674, 677.
[3] Esso Australia Resources Ltd v Commissioner of Taxation [1999] HCA 67; (1999) 201 CLR 49.
[4] Esso Australia Resources Ltd v Commissioner of Taxation [1999] HCA 67; (1999) 201 CLR 49, 61.
[5] SB6 to the affidavit of Sonya Lee Black.
[6] Bartolo v Doutta Galla Aged Services Limited [2014] FCCA 1517.
[7] Commissioner of Australian Federal Police v Propend Finance Pty Ltd (1997) 188 CLR 501, 508 (Brennan CJ).
[8] Sydney Airports Corporation Ltd v Singapore Airlines Ltd & Qantas Airways Ltd [2005] NSWCA 47.
[9] Sydney Airports Corporation Ltd v Singapore Airlines Ltd & Qantas Airways Ltd [2005] NSWCA 47, 55.
[10] Price Waterhouse v BCCI Holdings (Luxembourg) SA [1992] BCLC 583.
[11] Price Waterhouse v BCCI Holdings (Luxembourg) SA [1992] BCLC 583 at pp 590c - 591a.
[12] Re Highgrade Traders Ltd [1984] BCLC 151.
[13] Re Highgrade Traders Ltd [1984] BCLC 151, 173.
[14] Re Highgrade Traders Ltd [1984] BCLC 151, 173.
[15] In Re Clerks' (Alcoa of Australia - Mining and Refining) Consolidated Award 1985 [1988] AIRC 391; Print H2892.
[16] In Re Clerks' (Alcoa of Australia - Mining and Refining) Consolidated Award 1985 [1988] AIRC 391; Print H2892.
Wirth
State of Queensland
(1997) 188 CLR 501
(1999) 201 CLR 49
(1976) 135 CLR 674
(1987) 163 CLR 54