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[2014] WASC 388
Supreme Court of WA
2014-10-27
Martin J
Original judgment source is linked above.
1 KENNETH MARTIN J: At the conclusion of argument throughout 1 September 2014 on the plaintiffs' (Executors') application for directions and private advice pursuant to s 92 of the Trustees Act 1962 (WA), I was advised of an application to be made by counsel for the corporation Second Skin Pty Ltd (Second Skin). This was to advance Second Skin's assertion of a claim of legal professional privilege over two tranches of documents referred to within materials read during the course of the day on behalf of Mr Rudolf Baur, the second defendant. They are attachments to Mr Baur's sixth affidavit, sworn 20 August 2014 and as well read on behalf of Mr Robert Charles Scott, who is the third defendant (of effectively some of the same material).
2 One attachment to the sixth affidavit of Mr Baur is KRB52. This is, in fact, a series of five emails, with their attachments, exchanged in the period between 12 June and 22 June 2012, between Mr Morgan Solomon (said to be acting in the capacity of legal advisor through law firm Bowen Buchbinder Vilensky (BBV)) and directed to the attention of a Ms Shirley Anne Fletcher. Ms Fletcher was appointed as a director of Second Skin on 2 April 2012, but at material times was effectively the personal assistant to the late Ms Jennifer Ballantyne. Ms Ballantyne was at these times seriously ill with breast cancer. She subsequently died on 7 July 2012.
3 I extended to counsel for Second Skin an opportunity to formalise what was then a verbal assertion of legal professional privilege, under a proper application and by evidence.
4 I indicated I would receive written submissions on behalf of his client. I also directed that any opposing written submissions be filed thereafter. This was with a view to resolving the matter on the papers, if I could. I set a tight timetable in that respect.
5 Subsequently there was received a chamber summons of Second Skin filed on 3 September 2014, and asserting that corporation's legal professional privilege over two documents - the abovementioned attachment KRB52 to the sixth affidavit of Mr Baur, sworn 20 August 2014 and, as well, a claim of privilege over attachment KRB58 to the same affidavit.
6 Second Skin's application was supported by the affidavit of Ms Fletcher, now a director and company secretary of Second Skin, sworn 3 September 2014. The affidavit was accompanied by an outline of written submissions by Second Skin of the same date.
7 I next received Mr Baur's written submissions of 5 September 2014. He contended against the validity of the assertions of legal professional privilege by Second Skin. There was filed in support an affidavit of Alexander James Tarby, affirmed 5 September 2014.
8 I duly received Second Skin's reply submissions of 8 September 2014, now advising, in effect, that the assertion of privilege over the tranche of documents the subject of attachment KRB52, was no longer pressed. By par 1 it was said:
In particular, in circumstances where Mr Baur's sixth affidavit sworn 20 August 2014 has apparently been read in court and submissions been made on the documents constituting attachment 'KRB-52' to that affidavit, Second Skin has no objection to the court considering attachment 'KRB52' in considering Second Skin's claim to privilege.
9 But that still left attachment KRB58 still to be resolved.
10 Unlike documents the subject of attachment KRB52 which I had already read and considered in the hearing seeking private advice, the KRB58 document had been always kept sealed away in the open materials I received.
11 I was told in pars 17 - 22 of Ms Fletcher's affidavit (by her reference to par 56 of Mr Baur's sixth affidavit) that KRB58 was a copy of some email messages Ms Fletcher relates were sent to her by Mr Morgan Solomon of BBV, containing his legal advice to Second Skin.
12 But there were subsequent developments on the KRB58 front as well.
13 By Mr Baur's written submissions, par 3, it had been said:
Mr Baur does not press the Court to view Exhibit KRB-58: reference to that exhibit now being redundant in light of the answers provided to questions 5 and 6. If necessary, any argument as to privilege over that document can and should be determined when the issue is 'live', rather than hypothetical.
14 That stance now came to be accepted as legitimate by Second Skin, under its reply submissions of 8 September (par 8). However, those submissions, at par 9, did then go on to say that the question of privilege in respect of the same document had arisen as well in Mr Scott's action against Second Skin before Pritchard J in CIV 1492 of 2014. This action concerns Mr Scott's claim to one share in Second Skin (50% interest), and as well to be entitled to certain information as a shareholder of Second Skin.
15 Mr Scott's action was the subject of an application for summary judgment at a special appointment initially heard before Pritchard J in her Honour's CMC List on 8 September 2014.
16 The reply submissions of 8 September by Second Skin (par 9) went on to advise that:
Second Skin, having considered the document further, took the position that any privilege in the document was the Ms Ballantyne's estate's privilege and should be asserted by her executors. Counsel for Ms Ballantyne's executors appeared and asserted that privilege on the executors' behalf.
In those circumstances, Second Skin could not properly maintain its claim of privilege over 'KRB-58' in these proceedings, and would not now do so.
17 At this point I received a communication from BBV of 9 September 2014. This advised that in the Scott proceedings (CIV 1492 of 2014) before Pritchard J, the information I had received as to Second Skin's retreat from its earlier assertion of privilege was correctly stated.
18 Nevertheless, I was now told by BBV that in those proceedings '[c]ounsel for the executors claimed the privilege on before [sic, behalf] of the estate'.
19 The live privilege issue was apparently to be the subject of directions before her Honour on Wednesday, 10 September 2014.
20 That BBV communication of 9 September 2014 on behalf of the Executors also advised me:
Notwithstanding the above, we agree with the position put by the solicitors for Mr Kurt Baur in paragraph 3 of their submissions dated 5 September 2014, that the email is now redundant in light of the directions provided in answer to questions 5 and 6 of the Summons in CIV 1786 of 2014. Accordingly, we respectfully submit it is not necessary for the Court to consider the email or turn its mind to the issue of privilege in respect of it.
21 Given all that, my inclination then was to simply render no ruling concerning the status of attachment KRB58.
22 But the solicitors for Mr Scott before Pritchard J (who also participated as solicitors for Mr Scott, the third defendant in the Executors' application for directions pursuant to s 92 of the Trustees Act; CIV 1786 of 2014) now advised that the document which is attachment KRB58, was also attachment RCS12 to the affidavit of Mr Scott sworn 6 May 2014 in CIV 1373 of 2014, another Ballantyne estate matter managed by Pritchard J. It was now said (correctly) that Mr Scott's affidavit had also been read into evidence before me on 1 September 2014 in CIV 1786 of 2014.
23 Mr Scott's solicitors advised that both his clients (Mr Scott and the seventeenth defendant in CIV 1786 of 2014, Ms Michelle Anne Matthews) would not be filing submissions opposing the 'application' (presumably the privilege assertion 'application' initially made by Second Skin - subsequently no longer pressed by Second Skin, but in substitution still then pressed at all levels by the Executors).
24 Mr Scott's solicitors' communication also advised my Associate the third and seventeenth defendants 'remain interested on the question of costs'.
25 On 10 September 2014, my Associate was advised by email by the solicitors for Mr Scott and the seventeenth defendant that 'the 2 May email is relevant to whether the advice should be given in CIV 1412 of 2014, in which both of my clients have an interest'. This communication said:
The email goes to the conduct of Mr Solomon that is in turn relevant to whether he should be removed as an executor. Whilst it is not necessary for his Honour to make any findings as to conduct, it relevant for his Honour to know whether or not allegations of improper conduct based on the 2 May email (as outlined in Mr Scott's submissions filed herein) will be raised against the executors (or one of them) [and] will be made at the trial of CIV 1412 of 2014.
26 I was also advised under that communication that there would be a hearing before Pritchard J to determine the status of the Executors' privilege claim then asserted over the 2 May 2012 email, to be dealt with on 24 September 2014 at 10.30 am.
27 Noting that position of Mr Scott, in circumstances where questions 5 and 6 (in the amended originating summons in CIV 1786 of 2014) had already been answered by me on 1 September 2014, and where that communication has at all times been kept sealed and not yet seen by me, I was then of a view that it was not necessary to reach a determination upon it, given the pragmatic position as indicated by the Executors, by Second Skin, and by Mr Baur.
28 The s 92 Trustees Act proceedings are of a special character. They do not proceed on the basis of being adversarial. Ordinarily, private advice proceedings are determined by a court on the basis of agreed facts, with minimal if any underlying factual disputation.
29 Accordingly, I was then of the view that I would not look at, or receive what remained a sealed communication. That document would continue sealed, both as attachment KRB58 and as attachment RCS12 to my copy of Mr Scott's affidavit of 6 May 2014 in CIV 1373 of 2014 albeit the material had been read into evidence by reference in the private advice application proceedings.
30 However, there were even further developments. On Monday, 15 September, after I had written most of these reasons, a communication was received from BBV for the Executors now advising me that privilege was no longer claimed over the documents attached to Mr Baur's affidavit of 20 August 2014, being KRB52 and KRB58.
31 That being so, I now, with some level of exasperation, proceed on the basis that KRB58 and RCS12 (the same document) are no longer the subject of any claim to legal professional privilege from any party. Accordingly, I will receive those documents as available for consideration in the s 92 Trustees Act advice application - where my reasons stand as reserved as to question 1.