THE NATURE OF LEGAL PROFESSIONAL PRIVILEGE
90 There is no doubt or debate that the confidentiality of legal advice or instructions transmitted in the course of client/lawyer relationships should be maintained in order to protect and secure access to legal advice (Baker v Campbell (1983) 153 CLR 52 per Gibbs CJ at 66).
91 It is well established that a communication for the dominant purpose of obtaining legal advice or obtaining or providing legal services will attract privilege (Esso Australia Resources Ltd v Federal Commissioner of Taxation (1999) 201 CLR 49at [61]). Privilege will also extend to documents that record confidential legal advice or confidential legal work and to any document prepared by the lawyer or client from which there might be inferred the nature of the advice sought or given. Instructions given to the lawyer are also privileged as well as the advice of the lawyer.
92 The relevant test is 'anchored to the purpose for which the document was brought into existence' (Commissioner of Australian Federal Police v Propend Finance Pty Ltd (1997) 188 CLR 501 at 508 per Brennan J.
93 The precise issue under consideration is to be governed by the common law rather than by Pt 3.10 of the Evidence Act 1995 (Cth): Esso at 59-63 and Mann v Carnell (1999) 201 CLR 1 at [27].
94 The concept of legal advice is reasonably wide and it extends to professional advice given as to what a party should prudently or sensibly do in the relevant legal context: DSE (Holdings) Pty Ltd v InterTAN Inc (2003) 135 FCR 151 (at [25]-[71]). The Commonwealth contends that the redacted passages are self-evidently confidential communications recording and summarising instructions given to government legal advisors, together with advice provided, and to a more limited extent the knowledge or belief of the Department directly derived from that advice.
95 The Brief, while containing a great deal of legal advice itself, also records both legal advice and instructions seeking legal advice. Insofar as the redacted secondary records are concerned, there is no doubt (in principle) that legal professional privilege may be claimed. This has been expressed in many ways, as the authorities discussed by Young J in AWB Ltd v Cole (2006) 152 FCR 382 (at [127]-[131]) reveal:
Recording legal advice
[127] As an adjunct to the first limb of the privilege, protection against disclosure has been extended to documents that record confidential legal advice or confidential legal work. Examples commonly given include legal research memoranda, draft pleadings, summaries of argument and draft agreements: see Daniels at [44] per McHugh J; Propend at 550 per McHugh J and at 569 per Gummow J; Attorney-General (NT) v Maurice (1986) 161 CLR 475 at 496 per Dawson J; Trade Practices Commission v Sterling at 246 per Lockhart J; Mostyn v West Mostyn Coal and Iron Co Ltd (1876) 34 LT 531; and Packer v Deputy Commissioner of Taxation (Qld) [1984] 1 Qd R 275 at 284-285.
[128] Anderson J explained the scope of this protection and the reasons for it in Dalleagles (at 333-334):
What is protected, of course, is that which is communicated between solicitor and client. It is the communication that is privileged. But this is not to say that material that is not literally a communication or manifestly the record of a communication is never protected. There are many instances of protection being extended to such material. The examples of the draft letter that never leaves the solicitor's office, the draft agreement and the draft statement of claim have already been referred to. The reason why such material is protected is often stated to be that disclosure of it will, or will tend to, reveal the privileged communication: see Attorney-General (NT) v Maurice, per Dawson J (at 496). Thus a note made by a solicitor of a conference with his client will be privileged in so far as it is a record of the communication from the client (that communication being privileged) but also in so far as it might contain notes of the solicitor's own thoughts in regard to the matters communicated to him. Protection is afforded in the latter case on the ground that disclosure of that material might tend to reveal what had been communicated to the solicitor. There is much in the cases to support the view that this is the true basis upon which draft agreements, draft letters, draft pleadings and the like have long been accepted as privileged; that it is not so much because they are themselves "advice" or "communication" but because they will, if disclosed, reveal, or tend to reveal, the content of privileged communications. Material created by the solicitor in fulfilment of his engagement "is the result of the solicitor's mind working upon and acting as professional adviser with reference to" material communicated to him confidentially in his professional capacity (Kennedy v Lyell [1883] 23 Ch D 387 at 407) and, as such, will by its very nature tend to reveal the content of the communication in response to which it had been prepared.
Of course, there are limits and these have often been stated. The material must have been created solely for the purpose of fulfilling the engagement. The material must be confidential. No protection can extend to agreements in their final form intended to constitute the actual transaction between the parties or to records made for the purpose of evidencing an actual transaction, or to letters sent or to forms lodged at public offices or to pleadings filed in courts. This is because legal professional privilege exists to secure confidentiality and such material is no longer confidential.
[129] Gummow J proffered a similar explanation in Propend (at 569):
It also is significant, as Beaumont J emphasised in the present case that the privilege extends to any document prepared by a lawyer or client from which there might be inferred the nature of the advice sought or given. Examples include communications between the various legal advisers of the client, draft pleadings, draft correspondence with the client or the other party, and bills of costs.
This identification of the privilege with communications, rather than merely with documents, is important for the first issue on the grant of special leave.
[130] This line of authorities was canvassed by Allsop J in DSE, and I have gained assistance from several of the cases he discusses. In Bank of Nova Scotia v Hellenic Mutual War Risks Assn (Bermuda) Ltd [1992] 2 Lloyd's Rep 540 (The Good Luck), Saville J said (at 540):
In my view if a lawyer-client communication falls within the principles set out in Lord Justice Taylor's judgment (that is to say, is covered by legal professional privilege) then internal documents or parts of documents of the client (or indeed the lawyer) reproducing or otherwise revealing those communications are also covered by the same privilege, whatever the purpose or motive (short of fraud) for which the document comes into existence. The principle justifying legal professional privilege is (as Lord Justice Taylor pointed out) that a client should be able to obtain legal advice in confidence.
See also Hellenic Mutual War Risks Assn (Bermuda) Ltd v Harrison [1997] 1 Lloyd's Rep 160 at 171 (The Sagheera).
[131] In Wenkart, Branson J said that legal professional privilege extends to any document prepared either by the client or the legal adviser from which the nature of the advice sought, or given, might be inferred (eg a draft pleading, a solicitor's draft letter to the other side, or a bill of costs): see Williams NJ, "Four Questions of Privilege: the Litigation Aspects of Legal Professional Privilege", Civil Justice Quarterly, Vol 9, No 139, 1990, at p 142; and Propend Finance Pty Ltd v Commissioner of Australian Federal Police (1995) 58 FCR 224 at 236-237 per Beaumont J.
96 Mr Zentai argues that the Minister's function is essentially administrative and not judicial in nature although it must be performed in a manner which conforms to the requirements of natural justice and procedural fairness.
97 It is argued that the context of the Brief suggests that the advice of the CDPP and OIL were directed to addressing specific issues presented for the Attorney-General's consideration by various submissions raised on behalf of Mr Zentai. Such considerations cannot, it is submitted, raise any legitimate personal interest in not having the contents of the redacted materials disclosed. Equally, as the Commonwealth has not sought to invoke public interest immunity, the interests of the Republic of Hungary cannot be a basis for non-disclosure of the redacted portions.
98 Of particular significance in Mr Zentai's written submissions is that the administrative process entailed in making the Determination should not, therefore, be assimilated with any legal proceedings of the kind which would otherwise attract the automatic application of legal professional privilege to the advice included in the Brief which was initially provided by OIL and the CDPP. This is notwithstanding the fact that legal proceedings being brought by Mr Zentai might have been anticipated in the event of a decision unfavourable to him.
99 Legal advice such as any provided by the Australian Government Solicitor (AGS) or the CDPP relating to legal proceedings in which other Commonwealth officers, statutory authorities or departments might be engaged is generally capable of attracting professional privilege. As with in-house corporate counsel, this will be subject to the Government legal advisor acting in an independent and professional manner rather than in pursuit of any extraneous or improper purpose. Again, this is subject to the caveat that, in the case of the CDPP for example, the Director must be providing legal advice rather than engaging in matters of administrative process.
100 An important consideration is that there must be a client and legal advisor relationship for the privilege to apply. Mr Zentai contends that legal professional privilege is not applicable where, as in the present case, the Attorney-General is being provided with legal advice by a Commonwealth departmental officer such as the OIL which is in a direct relationship with him and which advice is provided only for the purpose of assisting him to lawfully discharge his public function and duty. Mr Zentai contends that the redacted material was not advice given independently at arms length.
101 In essence, Mr Zentai argues that the communications are constructively attributable to the Attorney-General as 'his own advice' and as such do not qualify within the lawyer/client relationship as being entitled to legal professional privilege. This is in contrast, it is said, with the situations in the cases relied upon by the Commonwealth where officers, for example, of the AGS advise other Commonwealth government departments at arms length. In cases where the internal advice is to the Attorney-General for the purpose of s 22 of the Act (or the Minister as his delegate), it is argued that that departmental advice is effectively internal and there is no 'client'.
102 As to the legal advice provided by OIL within the Attorney-General's Department Mr Zentai contends that this advice is in essence simply the Attorney-General informing himself as the material emanates from within his own Department and is provided to him. In those circumstances, it is said, there can be no lawyer/client relationship necessary to attract legal professional privilege.
103 As to the legal advice from or instructions to the CDPP, Mr Zentai says that even if this information was originally privileged as to which there is no evidence, there is no evidence that the release of that advice to the Attorney-General who is now claiming the privilege was subject to any claim for legal professional privilege, and if it was subject to privilege, it was the privilege of the AFP, not the privilege of the Attorney-General.
104 In the case of OIL, the Commonwealth, however, points to the fact that the Legal Services Directions made under Pt VIIC of the Judiciary Act specify certain types of legal work as 'tied work'. Public international law work including advice involving Australia's or another country's obligations under international law is included under the description of 'tied work'. OIL has a specific role when such issues arise. In particular, in relation to paras 84, 291 and 295, there is a summary of the advice which has been set out in detail in paras 202, 203 and 205. The Commonwealth complains that disclosure of those paragraphs or parts of paragraphs would reveal the content of legal advice. Similarly, para 202 also summarises the instructions seeking advice.
105 A central plank to the Commonwealth's claim for legal professional privilege is that advice obtained from Commonwealth legal advisors, whether they be in the Department or the CDPP attracts legal professional privilege.
106 In relation to lawyers within the Department, the position is covered by ss 55E-55G of the Judiciary Act which provides as follows:
55E Attorney-General's lawyers
(1) In this section and in sections 55F and 55G:
Attorney-General's lawyer means a person:
(a) whose name is on a roll referred to in subsection 55D(1); and
(b) who is either:
(i) the Secretary to the Attorney-General's Department; or
(ii) a person in the Attorney-General's Department who is engaged under the Public Service Act 1999.
(2) An Attorney-General's lawyer acting in that capacity is entitled:
(a) to do everything necessary or convenient for that purpose; and
(b) to practise as a barrister, solicitor, or barrister and solicitor in any court and in any State or Territory; and
(c) to all the rights and privileges of so practising;
whether or not he or she is so entitled apart from this subsection.
(3) An Attorney-General's lawyer acting in that capacity in a State or Territory is not subject to a law of a State or Territory that relates to legal practitioners except to the extent that such laws:
(a) impose rights, duties or obligations on legal practitioners in relation to their clients or to the courts; or
(b) provide for disciplinary proceedings in relation to the misconduct of legal practitioners.
(4) Subsection (3) is subject to subsection (6) and to section 55F (Attorney‑General's lawyer may act for more than one party).
(5) In considering the nature of the rights, duties and obligations of an Attorney‑General's lawyer in relation to a client, regard must be had to the lawyer's position as a person in the Attorney‑General's Department engaged under the Public Service Act 1999.
(6) An Attorney-General's lawyer acting in that capacity is not subject to a law of a State or Territory that is prescribed for the purposes of this section.
55F Attorney-General's lawyer may act for more than one party
An Attorney-General's lawyer may act in a matter for 2 or more parties who have conflicting interests in the matter if to do so has been approved by the Attorney‑General:
(a) by way of approval in relation to the particular matter; or
(b) by way of written arrangements covering the circumstances in which an Attorney-General's lawyer may so act.
55G Commonwealth may charge for services of Attorney-General's lawyer
(1) The Commonwealth may charge fees:
(a) in relation to services of a legal professional nature provided by an Attorney-General's lawyer in his or her capacity as a person in the Attorney-General's Department engaged under the Public Service Act 1999; and
(b) for disbursements incurred by the Commonwealth in the course of providing those services.
(2) If the Commonwealth has charged a client an amount under subsection (1), the amount may be recovered by the client as costs incurred by the client.
107 As to the CDPP, the position is covered by the Director of Public Prosecutions Act 1983 (Cth) s 5 and s 16 which respectively provide as follows:
5 Office of the Director of Public Prosecutions
(1) There is established an Office to be known as the Office of the Director of Public Prosecutions.
(2) There shall be a Director of Public Prosecutions and an Associate Director of Public Prosecutions.
(3) The Office shall consist of the Director and the members of the staff of the Office.
(4) The Director shall control the Office.
16 Right of Director and staff to practise in their official capacity
The Director, or a member of the staff of the Office who is a legal practitioner, is, in his or her official capacity:
(a) entitled to practise as a barrister, solicitor, or barrister and solicitor, in a federal court or in a court of a State or Territory; and
(b) entitled to all the rights and privileges of a barrister, solicitor, or barrister and solicitor, as the case may be, in that court;
whether or not he or she would, but for this section, be entitled to practise in that court.
108 The functions of the CDPP which are set out in s 6(1) and s 6(2) of the Director of Public Prosecutions Act 1983 and the Director of Public Prosecutions Regulations 1984, reg 3(1) unsurprisingly include giving advice to an authority of the Commonwealth.
109 As a matter of principle, legal professional privilege can attach to communications between a salaried legal advisor and his or her employer. It is the provisos and the application of the principle, subject to provisos, that give rise to the debate. The Commonwealth accepts that it is a proviso to that principle that the legal advisor is consulted in a professional capacity in relation to a professional matter and the communications are made in confidence and arise from the relationship of lawyer and client (Waterford v Commonwealth (1987) 163 CLR 54 per Dawson J at 96 and Deane J at 79-82).
110 In essence, the senior advisor must also be professionally independent or 'detached' (Rich v Harrington (2007) 245 ALR 106 and Candacal Pty Ltd v Industry Research and Development Board (2005) 59 ATR 615 at [64]-[71] and [99]).
111 The Commonwealth relies heavily on the Waterford decision and the conclusion in that decision as authority for the contention that the Commonwealth employs legal officers who have been recognised as securing that degree of independence. The fact that legal advice and services by Government lawyers have been held to attract privilege is not contentious. Examples of this include Waterford which related to material submitted to a Deputy Crown Solicitor's office in relation to litigation. However, Mr Zentai stresses that the material concerned involved independent opinions from three Queen's Counsel. The contrast, Mr Zentai says with the present circumstances is that the advice is coming from within the Attorney-General's own Department in one instance and from the CDPP to the AFP in another instance.
112 In Bennett v Chief Executive Officer, Australian Customs Service (2004) 140 FCR 101, an advice from AGS to the respondent was also treated as being privileged. Similarly, in Spassked Pty Ltd v Federal Commissioner of Taxation (No 4) (2002) 50 ATR 70 where material concerned in an expert brief prepared by the AGS was privileged. So, also, in New South Wales v Betfair Pty Ltd and Others (2009) 180 FCR 543 where advice regarding the drafting and preparation of legislation by Parliamentary counsel was protected. In a number of instances, advice by the CDPP to the AFP has expressly been privileged: Dunesky v Elder (1992) 35 FCR 429 and Grofam Pty Ltd v Australia and New Zealand Banking Group Ltd (1993) 45 FCR 445.
113 In Waterford, Waterford sought to obtain legal advice received by the Treasury Department from what is now the AGS. In response to a claim for privilege the High Court concluded that there is no reason to place legal officers in Government employment outside the bounds of legal professional privilege providing there was a professional relationship securing to the advice an independent character notwithstanding employment within the Government. The court concluded that as a general proposition, the participation of Government legal officers could entitle their clients to claim legal professional privilege.
114 In Waterford at 63-64, in a joint judgment of Mason J (as his Honour then was) and Wilson J, the Court said:
In our opinion, neither limb of the appellant's argument can be supported. The common law, in the view that we have taken, recognizes that legal professional privilege attaches to confidential, professional communications between government agencies and their salaried legal officers undertaken for the sole purpose of seeking or giving legal advice or in connexion with anticipated or pending litigation. Provided that the sole purpose test enunciated in Grant v Downs is satisfied, there is no warrant to draw an arbitrary line through the functions of government in order to exclude the privilege from those described as of an administrative nature. All the functions of the executive government may be so described. No distinction can be drawn between a decision to grant a pension and a decision whether to defend a claim in tort or contract. The growing complexity of the legal framework within which government must be carried on renders the rationale of the privilege, as expressed in Grant v Downs, increasingly compelling when applied to decision-makers in the public sector. The wisdom of the centuries is that the existence of the privilege encourages resort to those skilled in the law and that this makes for a better legal system. Government officers need that encouragement, albeit, perhaps, for reasons different to those which might be expected to motivate the citizen.
115 Subsequently in Assistant Treasurer and Minister for Competition Policy and Consumer Affairs v Cathay Pacific Airways Ltd and Another (2009) 179 FCR 323, in the judgment of Flick J with whom Spender and Lander JJ agreed (at [73]-[74]), his Honour said:
[73] The purpose of the Minute was to place before the Assistant Treasurer material upon which he could make an informed decision. That material has been identified. The Assistant Treasurer has made his decision and made his findings, including his finding at paragraph 25 of his statement of reasons that he had regard to the legal advices before him "and the conflict between those legal advices" and that he "was not satisfied that all or any part of the alleged conduct was required or specifically authorised by the law of any of the countries the subject of the application for consent".
[74] The withholding of the legal advice received from the Australian Government Solicitor, it is considered, has not occasioned any "ambiguity" or any "unfairness". Those parts of the Minute containing legal advice occur throughout the Minute, but each of those parts is considered to be severable from the balance of the document. The disclosure of that legal advice may well facilitate a greater understanding of the reasoning process pursued by the Assistant Treasurer, but the maintenance of the confidentiality in the legal advice operates no "unfairness". The maintenance of that confidentiality does not deny to Cathay Pacific the ability to know what material has or has not been taken into account.
116 Nothing in s 55E of the Judiciary Act appears to expressly touch on the question of whether advice given by an Attorney-General's lawyer to the Attorney-General attracts legal professional privilege, it is clear, nevertheless, from the authorities that advice given in that capacity is capable of attracting legal professional privilege. Those cases do not address the submission made for Mr Zentai that because the Departmental advice to the Attorney-General (or his delegate) was purely internal, the Attorney-General was doing no more than advising himself and there was no independent relationship of lawyer and client. Nothing in the statutory provisions or secondary material directly addresses this issue.
117 The Commonwealth however, stresses that the statutory and real independence of the advisors suffices. As in Waterford and Cathay Pacific,the purpose of advising was to provide legal material to assist with the exercise of a public duty under a statutory power or administrative or governmental function.