case_text: The High Court cases of Baker v Campbell [1983] HCA 39 ; (1983) 153 CLR 52 (' Baker ') at 76, 97 and 132, Commissioner of Australian Federal Police v Propend Finance Pty Ltd [1997] HCA 3 ; (1997) 188 CLR 501 (' Propend ') at 506, 513, 523, 533, 567-568 and 576, and Daniels Corporation International Pty Ltd v Australian Competition and Consumer Commission [2002] HCA 49 ; (2002) 213 CLR 543 (' Daniels ') at 549 [3], 561 [37], 567 [56] and 585 [117] proceed on the footing that the Federal Court has original jurisdiction to declare that legal professional privilege attaches to a document whose production has been compulsorily required, without any need to review or set aside the decision of the relevant officer to seize the document or to require its production. In Propend , Brennan CJ said at 513: 'When a claim of privilege attaching to a document seized under a warrant comes to be determined judicially, the court must ascertain for itself whether the document was brought into existence solely for a privileged purpose and, if it be found or assumed that the document is a copy of an unprivileged original but was brought into existence solely for a privileged purpose, whether the privilege has been lost. In determining the claim of privilege, the court is not reviewing judicially an executive action but is determining a distinct controversy between the person who seeks to inspect the seized document and the person who seeks to maintain its immunity from inspection on the ground of legal professional privilege.' Both parties submitted that the Court can approach the question of legal professional privilege in the manner indicated by Brennan CJ. 32 In Australia, legal professional privilege is a rule of substantive law that reflects an important common law immunity. In Daniels , Gleeson CJ, Gaudron, Gummow and Hayne JJ said at 552-553 [9]-[11]: 'It is now settled that legal professional privilege is a rule of substantive law which may be availed of by a person to resist the giving of information or the production of documents which would reveal communications between a client and his or her lawyer made for the dominant purpose of giving or obtaining legal advice or the provision of legal services, including representation in legal proceedings. It may here be noted that the "dominant purpose" test for legal professional privilege was recently adopted by this Court in Esso Australia Resources Ltd v Federal Commissioner of Taxation in place of the "sole purpose" test which had been applied following the decision in Grant v Downs . Being a rule of substantive law and not merely a rule of evidence, legal professional privilege is not confined to the processes of discovery and inspection and the giving of evidence in judicial proceedings. Rather and in the absence of provision to the contrary, legal professional privilege may be availed of to resist the giving of information or the production of documents in accordance with investigatory procedures of the kind for which s 155 of the Act provides. Thus, for example, it was held in Baker v Campbell , that documents to which legal professional privilege attaches could not be seized pursuant to a search warrant issued under s 10 of the Crimes Act 1914 (Cth). Legal professional privilege is not merely a rule of substantive law. It is an important common law right or, perhaps, more accurately, an important common law immunity. It is now well settled that statutory provisions are not to be construed as abrogating important common law rights, privileges and immunities in the absence of clear words or a necessary implication to that effect. That rule, the expression of which in this Court can be traced to Potter v Minahan , was the foundation for the decision in Baker v Campbell .' 34 The RCA does not abrogate legal professional privilege. It does not do so expressly and there is no basis for arguing that it does so by necessary implication. Powers that are conferred in general terms, such as those found in s 2(3A) and s 6F(1), will not be construed as abrogating or adversely affecting a fundamental common law right or immunity, unless Parliament makes its intention unmistakeably clear: see Baker at 96-97 per Wilson J, at 116-117 per Deane J, and at 132 per Dawson J; and Daniels at 553 [17] per Gleeson CJ, Gaudron, Gummow and Hayne JJ, at 562-563 [43] per McHugh J, at 576 [88] and 578 [93]-[94] per Kirby J, and at 591-593 [132]-[135] per Callinan J. 37 There is, however, a dispute as to how the RCA is to be construed so as to preserve legal professional privilege. AWB contends that, consistently with the approach adopted in Baker and Daniels , the power conferred by s 2(3A) is to be read down so that it does not reach documents which are the subject of legal professional privilege. The Commonwealth submits that legal professional privilege is preserved by s 3(5). It says that s 3(5) operates to displace the obligation to produce documents imposed by s 3(4) in circumstances where a person has a reasonable excuse for non-production. 40 In their joint judgment in Daniels , Gleeson CJ, Gaudron, Gummow and Hayne JJ construed s 155(1) and (2) as not conferring a power that abrogated legal professional privilege. They did so for essentially two reasons. In the first place, their Honours observed that subss (1) and (2) of s 155 must be construed consistently. Section 155(2) of the TPA is similar to the search warrant provision in s 10 of the Crimes Act 1914 (Cth) (' Crimes Act ') that was considered in Baker and Propend . They said that it was difficult to see any basis upon which that subsection could be construed, consistently with Baker and Propend , as authorising entry to premises for the purpose of inspecting and copying material to which legal professional privilege attaches: at 558-559 [27]-[28]. Secondly, their Honours thought that s 155(5)(a) did not support the implication that the Full Court had drawn from it (at 560 [33]): 'It is very much to be doubted that sub-s (5)(a) is exhaustive of the matters that may be raised in answer to a charge of failing to comply with a notice under s 155(1). At the very least, ordinary principles of construction would suggest that there is an intentional element to the offences created by s 155(5) and (6A). More to the point, however, it is necessary to determine the meaning and effect of s 155(1) before it can be determined what constitutes a refusal or failure to comply with a notice.' 41 McHugh J said that s 155(5)(a) was of no assistance in construing s 155(1), as the implied duty created by s 155(5) operates only in respect of documents which s 155(1), on its proper construction, requires to be produced: at 564 [46]. McHugh J also thought that the contention that the power conferred by s 155(1) is not subject to privilege was inconsistent with the fact that the power conferred by s 155(2) must be regarded as subject to legal professional privilege, having regard to the decision in Baker : at 565-566 [50]-[51]. 51 In my opinion, it is a false dichotomy to suppose that a choice must be made between the construction advanced by AWB and that advanced by the Commonwealth. I prefer to see the two arguments as complementary threads in the harmonious construction of the RCA: see Project Blue Sky at 381-382 [70] per McHugh, Gummow, Kirby and Hayne JJ. The principle enshrined in Baker and Daniels is that, in the absence of clear and unmistakable language, a compulsive notice such as that which can be issued under s 2(3A) will not be construed as requiring the production of legally privileged documents. There is no reason why this principle should not apply in its full rigour to the RCA. A construction of s 2(3A) that accords with this principle is supported by s 3(5) ; it affords a textual indication that a notice under s 2(3A) does not reach, and consequently s 3(4) does not apply to, documents which are the subject of legal professional privilege. 52 The joint judgment of Gleeson CJ, Gaudron, Gummow and Hayne JJ and the separate judgment of McHugh J in Daniels also make the point that it is necessary to determine the meaning and effect of the provision under which the notice for production is given before it can be determined what constitutes a refusal or failure to comply with the notice. There is nothing to suggest that the approach of the High Court in Baker and in Daniels would have been any different if the offence provisions relating to s 10 of the Crimes Act and s 155 of the TPA contained a 'reasonable excuse' exception. 53 The role that both threads can play in the overall construction of the RCA is illustrated by the facts of this case. Exhibit 665 was produced to the Commissioner in answer to the notice, albeit inadvertently and without waiving legal professional privilege in respect of the document. In those circumstances, the provisions of s 3(4) and (5) are not directly applicable and the question would arise whether the Commissioner's powers under s 6F to inspect, retain and copy documents which have been produced under a notice under s 2(3A) are to be read down, consistently with Baker and Daniels , as not extending to documents which are the subject of legal professional privilege. 55 I do not consider that it is any objection to the construction I prefer that the application of the principle in Baker and Daniels to read down the scope of a notice issued pursuant to s 2(3A), and the inclusion of legal professional privilege within the concept of reasonable excuse, might be described as a 'belt and braces' approach. There is nothing incongruous in such an approach where the objective of the exercise is the protection of a fundamental immunity recognised by the common law. 59 Furthermore, I do not accept the second step in the Commonwealth's argument. A reasonable excuse can obviously arise in a range of circumstances. Some circumstances amounting to reasonable excuse, such as physical incapacity, may intervene after the notice to produce has been served. In such a case, it may be appropriate to speak of s 3(5) displacing the obligation to produce non-privileged documents that is otherwise imposed by s 3(4). But to my mind it offends the general principles enunciated in Baker and Daniels to argue that a notice under s 2(3A) imposes an unqualified obligation to produce documents that are the subject of legal professional privilege, unless and until a reasonable excuse is established within the meaning of s 3(5). In my opinion, there is nothing in the RCA to support the contention that the Commissioner has implied authority to inspect documents produced under a s 2(3A) notice for the purpose of determining whether they attract legal professional privilege. 61 In Esso Australia Resources Limited v Commissioner of Taxation [1999] HCA 67 ; (1999) 201 CLR 49 (' Esso ') at 64-65 [35], Gleeson CJ, Gaudron and Gummow JJ said: 'Legal professional privilege (or client legal privilege) protects the confidentiality of certain communications made in connection with giving or obtaining legal advice or the provision of legal services, including representation in proceedings in a court. In the ordinary course of events, citizens engage in many confidential communications, including communications with professional advisers, which are not protected from compulsory disclosure. The rationale of the privilege has been explained in a number of cases, including Baker v Campbell , and Grant v Downs itself. The privilege exists to serve the public interest in the administration of justice by encouraging full and frank disclosure by clients to their lawyers. In Waterford v The Commonwealth , Mason and Wilson JJ explained that legal professional privilege is itself the product of a balancing exercise between competing public interests and that, given the application of the privilege, no further balancing exercise is required. As Deane J expressed it in Baker v Campbell , a person should be entitled to seek and obtain legal advice in the conduct of his or her affairs, and legal assistance in and for the purposes of the conduct of actual or anticipated litigation, without the apprehension of being prejudiced by subsequent disclosure of the communication.' 154 The judgments in Baker trace the origins of the two limbs of legal professional privilege. Dawson J noted at 128, by reference to Lord Selborne LC's speech in Minet v Morgan (1873) 8 Ch App 361 at 366, that the law had advanced by successive steps: privilege was extended from communications relating to actual litigation to communications in anticipation in litigation and then to communications covering both litigation and legal advice. The litigation limb of the privilege developed first in response to the perceived requirements for a fair trial. Mason J said that communications in aid of litigation work were protected because 'to compel the parties to disclose such communications made in the conduct of that litigation would be unfair to them, hamper the preparation of their cases and protract the determination of the litigation': at 75. Brennan J referred to the 'lawyers brief' rationale that had been advanced by James LJ in Anderson v Bank of British Columbia (1876) 2 Ch D 644 at 656 and by Lord Simon in Waugh at 537, and said at 108: 'If the prosecution, authorized to search for privileged documents, were able to open up the accussed's brief while its own stayed tightly tied, a fair trial could hardly be obtained.' See also Deane J at 113-116. 156 In Carter at 160-161, McHugh J said that explanations of the rationale that have been put forward in terms of the proper functioning of the legal system or the perfect administration of justice take too little account of the fact that the privilege protects communications that seek or give legal advice in cases where no litigation is pending or contemplated. His Honour therefore expressed the rationale for the privilege more broadly: 'Now that this Court has held that legal professional privilege is not a rule of evidence but a substantive rule of law, the best explanation of the doctrine is that it is 'a practical guarantee of fundamental, constitutional or human rights'. By protecting the confidentiality of communications between lawyer and client, the doctrine protects the rights and privacy of persons including corporations by ensuring unreserved freedom of communication with professional lawyers who can advise them of their rights under the law and, where necessary, take action on their behalf to defend or enforce those rights. The doctrine is a natural, if not necessary, corollary of the rule of law and a potent force for ensuring that the equal protection of the law is a reality.' See also Brennan J in Carter at 127; Baker at 94-95, 118 and 130; Waterford v Commonwealth [1987] HCA 25 ; (1987) 163 CLR 54 (' Waterford' ) at 64; Maurice at 487; and Three Rivers at 677 [C] per Lord Carswell. 179 In Baker , Mason J said that a decision of an executive officer on a question of legal professional privilege would not be conclusive; a decision of a court on a prosecution for contravention of the statutory obligation or in proceedings for a declaration as to the existence of the privilege would be required in order to provide a conclusive answer: at 76; see also at 97 per Wilson J, at 105 per Brennan J, and at 132 per Dawson J. Daniels proceeded on the same basis. 188 The second area of dispute between AWB and the Commonwealth related to the Commonwealth's submission that the Commissioner has an implied authority under the RCA to require production of a document that is claimed to be the subject of legal professional privilege for the limited purpose of inspecting it in order to determine whether the claim to privilege is made out. In the course of considering the proper construction of the RCA, I rejected this submission on the grounds that it is not supported by the RCA and infringes the principles enunciated in Baker and Daniels .


case_outcome: applied

case_text: The High Court cases of Baker v Campbell [1983] HCA 39 ; (1983) 153 CLR 52 (' Baker ') at 76, 97 and 132, Commissioner of Australian Federal Police v Propend Finance Pty Ltd [1997] HCA 3 ; (1997) 188 CLR 501 (' Propend ') at 506, 513, 523, 533, 567-568 and 576, and Daniels Corporation International Pty Ltd v Australian Competition and Consumer Commission [2002] HCA 49 ; (2002) 213 CLR 543 (' Daniels ') at 549 [3], 561 [37], 567 [56] and 585 [117] proceed on the footing that the Federal Court has original jurisdiction to declare that legal professional privilege attaches to a document whose production has been compulsorily required, without any need to review or set aside the decision of the relevant officer to seize the document or to require its production. In Propend , Brennan CJ said at 513: 'When a claim of privilege attaching to a document seized under a warrant comes to be determined judicially, the court must ascertain for itself whether the document was brought into existence solely for a privileged purpose and, if it be found or assumed that the document is a copy of an unprivileged original but was brought into existence solely for a privileged purpose, whether the privilege has been lost. In determining the claim of privilege, the court is not reviewing judicially an executive action but is determining a distinct controversy between the person who seeks to inspect the seized document and the person who seeks to maintain its immunity from inspection on the ground of legal professional privilege.' Both parties submitted that the Court can approach the question of legal professional privilege in the manner indicated by Brennan CJ. 40 In their joint judgment in Daniels , Gleeson CJ, Gaudron, Gummow and Hayne JJ construed s 155(1) and (2) as not conferring a power that abrogated legal professional privilege. They did so for essentially two reasons. In the first place, their Honours observed that subss (1) and (2) of s 155 must be construed consistently. Section 155(2) of the TPA is similar to the search warrant provision in s 10 of the Crimes Act 1914 (Cth) (' Crimes Act ') that was considered in Baker and Propend . They said that it was difficult to see any basis upon which that subsection could be construed, consistently with Baker and Propend , as authorising entry to premises for the purpose of inspecting and copying material to which legal professional privilege attaches: at 558-559 [27]-[28]. Secondly, their Honours thought that s 155(5)(a) did not support the implication that the Full Court had drawn from it (at 560 [33]): 'It is very much to be doubted that sub-s (5)(a) is exhaustive of the matters that may be raised in answer to a charge of failing to comply with a notice under s 155(1). At the very least, ordinary principles of construction would suggest that there is an intentional element to the offences created by s 155(5) and (6A). More to the point, however, it is necessary to determine the meaning and effect of s 155(1) before it can be determined what constitutes a refusal or failure to comply with a notice.' 102 The question whether the draft statement of contrition that now constitutes Exhibit 665 was brought into existence for the dominant purpose of obtaining legal advice is a question of fact. In answering this question it must be kept firmly in mind that the privilege protects confidential communications, and not documents as such. As Dawson J said in Propend at 515, 'to say that a document is privileged is merely a shorthand way of saying that the communication constituted by the document is privileged': see also Toohey J at 525, Gaudron J at 543, McHugh J at 552 and Gummow J at 569. 103 The decision in Propend turned fundamentally on the proposition that legal professional privilege protects communications rather than documents. This explains why, as the High Court held in Propend , legal professional privilege can attach to copies of non-privileged documents; the purpose of bringing the copy into existence may be different from the purpose of bringing the original into existence, and may attract legal professional privilege: see Brennan CJ at 507, Gaudron J at 544, McHugh J at 553-554, Gummow J at 571 and Kirby J at 587. 104 In this case, attention must focus on the creation and circulation of the draft statement of contrition that became Exhibit 665. The confidential communications involved in those steps are distinct from the possible future step of communicating a statement of contrition to the public through the medium of evidence to be given by Mr Lindberg at the Inquiry. 118 The mere fact that the draft statement of contrition was sent by email to Mr Zwier, amongst others, for his legal advice is not determinative of the dominant purpose for which the draft statement was created. Nor does it determine that one intended use of the document was more dominant than other intended uses. As Brennan CJ said in Propend at 508, the test is anchored to the purpose for which the document was brought into existence. I have taken into account Mr Lindberg's evidence that it was always contemplated that any statement of a public relations kind would have to be part of, or a sub-set of, the legal strategy of AWB in dealing with the Inquiry. By this, Mr Lindberg explained that he meant that if the statement were to proceed it had to be supported by legal advice, including the accuracy of the facts and conduct about which AWB was prepared to apologise. Mr Lindberg said that his most important concern was about giving clear, honest and true evidence to the Inquiry. I accept that the proposed statement of contrition had to be evaluated against legal advice. None of this evidence is inconsistent with, or causes me to doubt, my finding that the statement of contrition was brought into existence for multiple purposes and none was dominant. 119 The Solicitor-General for the Commonwealth argued that the heading of Exhibit 665 indicates the character and purpose of the document, which was to influence public opinion through the vehicle of a statement that was to be made by Mr Lindberg during the course of his evidence to the Inquiry. The Solicitor-General added that it should be inferred that this purpose was to be implemented, conditional on the course of action being cleared by AWB's lawyers. It seems to me that this characterisation goes further than the evidence permits. The evidence does not allow me to find that the purpose of making a public relations statement was the sole purpose, or that it had matured to the point where it was going to be implemented, subject to legal clearance. In addition, I consider that the submission tends to confuse the purpose of possible future evidence to the Inquiry with the purpose and intended use of the draft statement that constituted Exhibit 665. 120 In its submissions, AWB contended that the evidence discloses three possible purposes for the creation of Exhibit 665 which it referred to as the immediate purpose, the intermediate purpose and the ultimate purpose. The immediate purpose of the document was said to be disclosed by the fact that it was brought into existence at the direction of Mr Zwier, notwithstanding that it was authored by Mr Lindberg. AWB submitted that Mr Zwier's purpose is important, taken together with the objective purposes of the document and its context. In my view, this submission misstates the relevant evidence. 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 563 [44] per McHugh J; Propend at 550 per McHugh J and at 569 per Gummow J; Attorney-General (NT) v Maurice [1986] HCA 80 ; (1986) 161 CLR 475 (' Maurice' ) at 496 per Dawson J; Sterling [1978] 36 FLR 244 at 246 per Lockhart J; Mostyn v West Mostyn Coal Co (1876) 34 LT 531; and Packer v Deputy Commissioner of Taxation (Qld) [1984] 1 Qd R 275 (' Packer' ) at 284-285. 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.' 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 NJ Williams, '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. 132 The principles that emerge from these cases operate to protect privileged communications against the risk that they will be disclosed by secondary evidence: see Tomlinson J in Three Rivers [2002] EWHC 2730 (Comm) at [3]. The question whether privileged communications will be disclosed by virtue of the disclosure of another document, such as a draft pleading, draft agreement or draft witness statement, raises a question of objective fact that depends on what the other document actually states or conveys, either explicitly or as a matter of reasonable inference. To adapt the language used by Gummow J in Propend and Anderson J in Dalleagles , the question is whether the disclosure of the document in question will directly reveal, or allow its reader to infer, the actual content or substance of a privileged communication. 180 Propend does not lend any support to the contention that the Commissioner's ruling on legal professional privilege is amenable to judicial review. Although there were judicial review applications in Propend , the case proceeded on the basis that the appropriate form of relief to resolve the privilege issue was a declaration in pursuance of the Court's jurisdiction under s 39B of the Judiciary Act : at 506 and 513 per Brennan CJ, and at 568 and 576 per Gummow J.


case_title: Daniels Corporations International Pty Ltd v Australian Competition and Consumer Commission [2002] HCA 49 ; (2002) 213 CLR 543

case_text: The High Court cases of Baker v Campbell [1983] HCA 39 ; (1983) 153 CLR 52 (' Baker ') at 76, 97 and 132, Commissioner of Australian Federal Police v Propend Finance Pty Ltd [1997] HCA 3 ; (1997) 188 CLR 501 (' Propend ') at 506, 513, 523, 533, 567-568 and 576, and Daniels Corporation International Pty Ltd v Australian Competition and Consumer Commission [2002] HCA 49 ; (2002) 213 CLR 543 (' Daniels ') at 549 [3], 561 [37], 567 [56] and 585 [117] proceed on the footing that the Federal Court has original jurisdiction to declare that legal professional privilege attaches to a document whose production has been compulsorily required, without any need to review or set aside the decision of the relevant officer to seize the document or to require its production. In Propend , Brennan CJ said at 513: 'When a claim of privilege attaching to a document seized under a warrant comes to be determined judicially, the court must ascertain for itself whether the document was brought into existence solely for a privileged purpose and, if it be found or assumed that the document is a copy of an unprivileged original but was brought into existence solely for a privileged purpose, whether the privilege has been lost. In determining the claim of privilege, the court is not reviewing judicially an executive action but is determining a distinct controversy between the person who seeks to inspect the seized document and the person who seeks to maintain its immunity from inspection on the ground of legal professional privilege.' Both parties submitted that the Court can approach the question of legal professional privilege in the manner indicated by Brennan CJ. 32 In Australia, legal professional privilege is a rule of substantive law that reflects an important common law immunity. In Daniels , Gleeson CJ, Gaudron, Gummow and Hayne JJ said at 552-553 [9]-[11]: 'It is now settled that legal professional privilege is a rule of substantive law which may be availed of by a person to resist the giving of information or the production of documents which would reveal communications between a client and his or her lawyer made for the dominant purpose of giving or obtaining legal advice or the provision of legal services, including representation in legal proceedings. It may here be noted that the "dominant purpose" test for legal professional privilege was recently adopted by this Court in Esso Australia Resources Ltd v Federal Commissioner of Taxation in place of the "sole purpose" test which had been applied following the decision in Grant v Downs . Being a rule of substantive law and not merely a rule of evidence, legal professional privilege is not confined to the processes of discovery and inspection and the giving of evidence in judicial proceedings. Rather and in the absence of provision to the contrary, legal professional privilege may be availed of to resist the giving of information or the production of documents in accordance with investigatory procedures of the kind for which s 155 of the Act provides. Thus, for example, it was held in Baker v Campbell , that documents to which legal professional privilege attaches could not be seized pursuant to a search warrant issued under s 10 of the Crimes Act 1914 (Cth). Legal professional privilege is not merely a rule of substantive law. It is an important common law right or, perhaps, more accurately, an important common law immunity. It is now well settled that statutory provisions are not to be construed as abrogating important common law rights, privileges and immunities in the absence of clear words or a necessary implication to that effect. That rule, the expression of which in this Court can be traced to Potter v Minahan , was the foundation for the decision in Baker v Campbell .' 34 The RCA does not abrogate legal professional privilege. It does not do so expressly and there is no basis for arguing that it does so by necessary implication. Powers that are conferred in general terms, such as those found in s 2(3A) and s 6F(1), will not be construed as abrogating or adversely affecting a fundamental common law right or immunity, unless Parliament makes its intention unmistakeably clear: see Baker at 96-97 per Wilson J, at 116-117 per Deane J, and at 132 per Dawson J; and Daniels at 553 [17] per Gleeson CJ, Gaudron, Gummow and Hayne JJ, at 562-563 [43] per McHugh J, at 576 [88] and 578 [93]-[94] per Kirby J, and at 591-593 [132]-[135] per Callinan J. 37 There is, however, a dispute as to how the RCA is to be construed so as to preserve legal professional privilege. AWB contends that, consistently with the approach adopted in Baker and Daniels , the power conferred by s 2(3A) is to be read down so that it does not reach documents which are the subject of legal professional privilege. The Commonwealth submits that legal professional privilege is preserved by s 3(5). It says that s 3(5) operates to displace the obligation to produce documents imposed by s 3(4) in circumstances where a person has a reasonable excuse for non-production. 38 In Daniels , the ACCC argued that s 155(5) of the Trade Practices Act 1974 (Cth) ('TPA') indicated that the power to compel the production of documents conferred by s 155(1) was not subject to legal professional privilege. Section 155(5)(a) provided that a person shall not refuse or fail to comply with a notice to the extent that the person is capable of complying with it. Section 155(5)(a) of the TPA therefore performed a role similar to s 3(4) and (5) of the RCA, except that it was expressed in more restricted terms. 39 The Full Federal Court in Australian Competition and Consumer Commission v Daniels Corporation International Pty Ltd [2001] FCA 244 ; (2001) 108 FCR 123 (' ACCC v Daniels' ) accepted the argument founded upon s 155(5). Moore J considered that the language of s 155(5)(a) was emphatic and required compliance with a notice issued under s 155(1) if the recipient was physically capable of complying with it: at 145 [81], see also at 137 [59] per Wilcox J. Lindgren J agreed generally with the reasons for decision of Wilcox J and Moore J. On appeal, the High Court rejected the argument. 40 In their joint judgment in Daniels , Gleeson CJ, Gaudron, Gummow and Hayne JJ construed s 155(1) and (2) as not conferring a power that abrogated legal professional privilege. They did so for essentially two reasons. In the first place, their Honours observed that subss (1) and (2) of s 155 must be construed consistently. Section 155(2) of the TPA is similar to the search warrant provision in s 10 of the Crimes Act 1914 (Cth) (' Crimes Act ') that was considered in Baker and Propend . They said that it was difficult to see any basis upon which that subsection could be construed, consistently with Baker and Propend , as authorising entry to premises for the purpose of inspecting and copying material to which legal professional privilege attaches: at 558-559 [27]-[28]. Secondly, their Honours thought that s 155(5)(a) did not support the implication that the Full Court had drawn from it (at 560 [33]): 'It is very much to be doubted that sub-s (5)(a) is exhaustive of the matters that may be raised in answer to a charge of failing to comply with a notice under s 155(1). At the very least, ordinary principles of construction would suggest that there is an intentional element to the offences created by s 155(5) and (6A). More to the point, however, it is necessary to determine the meaning and effect of s 155(1) before it can be determined what constitutes a refusal or failure to comply with a notice.' 42 The High Court in Daniels was considering a different statutory scheme and consequently the decision provides guidance only: see Daniels at 566 [53] per McHugh J; Western Australia v Ward [2002] HCA 28 ; (2002) 213 CLR 1 at 216 [480] - [481] per Kirby J; and Project Blue Sky Inc v Australian Broadcasting Authority [1998] HCA 28 ; (1998) 194 CLR 355 (' Project Blue Sky ') at 381-382 [69]-[71] per McHugh, Gummow, Kirby and Hayne JJ. The Commonwealth submits that the key to understanding the High Court's construction of s 155 is that the obligation to comply with a notice under s 155 was cast very widely in s 155(5)(a); it operated to the extent that the person concerned was capable of complying with the notice. To preserve legal professional privilege, the Commonwealth says that the power conferred by s 155(1) and (2) had to be read down because there was no other vehicle to achieve that result. 43 The scheme of the RCA is somewhat different. The combined effect of s 3(4) and (5) is that the obligation of a person served with a notice issued under s 2(3A) to produce the documents specified therein 'does not apply if the person has a reasonable excuse'. The definition of 'reasonable excuse' in s 1B operates in relation to any act or omission by a witness or a person summoned as a witness before the Commission. The obligations of a witness, or a person summoned as a witness, before a Commission are addressed in s 3(1) to (3) inclusive. But the definition does not apply directly to s 3(5) , which is directed to the obligations of a person (who may not be a witness) to produce documents at a time or place specified in the notice. 44 In Re HIH Insurance Limited [2002] NSWSC 231 at [12] , Barrett J said that the non-application of the definition of 'reasonable excuse' in s 1B to a person served with a s 2(3A) notice seems to mean that the term 'reasonable excuse' in s 3(5) is confined to physical or practical difficulties of complying and does not extend to matters such as legal professional privilege. This view was expressed somewhat tentatively, it predates the decision of the High Court in Daniels , and it was heavily influenced by the decision of the Full Federal Court in ACCC v Daniels and the earlier decision of the High Court in Corporate Affairs Commission (NSW) v Yuill [1991] HCA 28 ; (1991) 172 CLR 319 (' Yuill '). Neither AWB nor the Commonwealth contended that 'reasonable excuse' in s 3(5) should be construed in this manner. 45 The Commonwealth submitted that, even though the definition of reasonable excuse does not apply directly to s 3(5) , it is reasonable to infer that Parliament intended the term to bear the same substantive meaning throughout s 3. Further, the Commonwealth submitted that there is no reason to exclude legal professional privilege from the concept of 'reasonable excuse' where it is used in s 3(5). To do so would not be consistent with the parliamentary intention of ensuring that legal professional privilege is preserved and not abrogated. 46 I am not persuaded that the definition in s 1B should be extended, by implication or by construction, to s 3(5). Where a witness fails to produce a document that was required to be produced under s 2(1) or (2), s 3(2A) provides that any resulting offence is one of strict liability. Under s 6.1 of the Schedule to the Criminal Code Act 1995 (Cth) (' Criminal Code '), this means that there is no fault element, but a defence of mistake of fact is available. As there is no similar provision in relation to s 3(4) , there is an intentional element to the offence created by s 3(4): see s 5.6 of the Criminal Code . In these circumstances, I consider that the legislature intended that the expression 'reasonable excuse' should carry its ordinary meaning in s 3(5). That meaning may be wider than the definition in s 1B; certainly it is wide enough to cover any matter, including absence of intention, which the law acknowledges by way of answer, defence, justification or excuse for refusing or failing to produce the specified documents: see Yuill at 338-339 per Gaudron J. 51 In my opinion, it is a false dichotomy to suppose that a choice must be made between the construction advanced by AWB and that advanced by the Commonwealth. I prefer to see the two arguments as complementary threads in the harmonious construction of the RCA: see Project Blue Sky at 381-382 [70] per McHugh, Gummow, Kirby and Hayne JJ. The principle enshrined in Baker and Daniels is that, in the absence of clear and unmistakable language, a compulsive notice such as that which can be issued under s 2(3A) will not be construed as requiring the production of legally privileged documents. There is no reason why this principle should not apply in its full rigour to the RCA. A construction of s 2(3A) that accords with this principle is supported by s 3(5) ; it affords a textual indication that a notice under s 2(3A) does not reach, and consequently s 3(4) does not apply to, documents which are the subject of legal professional privilege. 52 The joint judgment of Gleeson CJ, Gaudron, Gummow and Hayne JJ and the separate judgment of McHugh J in Daniels also make the point that it is necessary to determine the meaning and effect of the provision under which the notice for production is given before it can be determined what constitutes a refusal or failure to comply with the notice. There is nothing to suggest that the approach of the High Court in Baker and in Daniels would have been any different if the offence provisions relating to s 10 of the Crimes Act and s 155 of the TPA contained a 'reasonable excuse' exception. 53 The role that both threads can play in the overall construction of the RCA is illustrated by the facts of this case. Exhibit 665 was produced to the Commissioner in answer to the notice, albeit inadvertently and without waiving legal professional privilege in respect of the document. In those circumstances, the provisions of s 3(4) and (5) are not directly applicable and the question would arise whether the Commissioner's powers under s 6F to inspect, retain and copy documents which have been produced under a notice under s 2(3A) are to be read down, consistently with Baker and Daniels , as not extending to documents which are the subject of legal professional privilege. 55 I do not consider that it is any objection to the construction I prefer that the application of the principle in Baker and Daniels to read down the scope of a notice issued pursuant to s 2(3A), and the inclusion of legal professional privilege within the concept of reasonable excuse, might be described as a 'belt and braces' approach. There is nothing incongruous in such an approach where the objective of the exercise is the protection of a fundamental immunity recognised by the common law. 59 Furthermore, I do not accept the second step in the Commonwealth's argument. A reasonable excuse can obviously arise in a range of circumstances. Some circumstances amounting to reasonable excuse, such as physical incapacity, may intervene after the notice to produce has been served. In such a case, it may be appropriate to speak of s 3(5) displacing the obligation to produce non-privileged documents that is otherwise imposed by s 3(4). But to my mind it offends the general principles enunciated in Baker and Daniels to argue that a notice under s 2(3A) imposes an unqualified obligation to produce documents that are the subject of legal professional privilege, unless and until a reasonable excuse is established within the meaning of s 3(5). In my opinion, there is nothing in the RCA to support the contention that the Commissioner has implied authority to inspect documents produced under a s 2(3A) notice for the purpose of determining whether they attract legal professional privilege. 60 In the passages that I have extracted from Daniels , Gleeson CJ, Gaudron, Gummow and Hayne JJ said that legal professional privilege applies to communications between a client and his or her lawyer made for the dominant purpose of giving or obtaining legal advice or the provision of legal services, including representation in legal proceedings. McHugh J added that the immunity also protects the disclosure of documents that record legal work carried out by the lawyer for the benefit of a client, such as research memoranda. 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 563 [44] per McHugh J; Propend at 550 per McHugh J and at 569 per Gummow J; Attorney-General (NT) v Maurice [1986] HCA 80 ; (1986) 161 CLR 475 (' Maurice' ) at 496 per Dawson J; Sterling [1978] 36 FLR 244 at 246 per Lockhart J; Mostyn v West Mostyn Coal Co (1876) 34 LT 531; and Packer v Deputy Commissioner of Taxation (Qld) [1984] 1 Qd R 275 (' Packer' ) at 284-285. 157 In Pratt Holdings , Stone J concluded that the High Court's exposition of legal professional privilege in Daniels , Esso and other cases demonstrates that it is supported by a single rationale which applies to both litigation privilege and legal advice privilege: at 381 [85]. Merkel J agreed with this conclusion. However, Stone J added that the existence of a single rationale does not mean that it is no longer necessary to have regard to the different categories of legal advice and litigation privilege. Finn J did not find it necessary to decide whether legal professional privilege should now be recognised as a unified doctrine which, though having two applications (ie advice and litigation), has a single rationale. His Honour regarded this controversy as a well recognised one and observed that, at an appropriate level of abstraction, a common and unifying rationale can be found for both manifestations of the privilege: at 361 [9]. 159 AWB also relied upon the broad terms in which legal professional privilege was expressed in the joint judgments in Daniels at 552 [9] and Esso at 64 [35]. In the latter case, Gleeson CJ, Gaudron and Gummow JJ said that the privilege protects the confidentiality of certain communications made in connection with the provision of legal services, including representation in proceedings in a court. AWB also referred to s 119 of the Evidence Act 1995 (Cth) which refers to 'professional legal services relating to an Australian or overseas proceeding'. In my opinion, these matters do not support the extension of litigation privilege to the context of a commission of inquiry. In Daniels and Esso, the High Court was trying to describe the scope of the privilege in a summary way. The description recognises that in appropriate cases the privilege can extend beyond legal advice to include other forms of legal work. It would be wrong to infer from the High Court's summary statement that it was intending to radically enlarge the operation of the rule. And in my view the language used in s 119 does not disclose any intention to extend litigation privilege to the conduct of a commission of inquiry. 179 In Baker , Mason J said that a decision of an executive officer on a question of legal professional privilege would not be conclusive; a decision of a court on a prosecution for contravention of the statutory obligation or in proceedings for a declaration as to the existence of the privilege would be required in order to provide a conclusive answer: at 76; see also at 97 per Wilson J, at 105 per Brennan J, and at 132 per Dawson J. Daniels proceeded on the same basis. 188 The second area of dispute between AWB and the Commonwealth related to the Commonwealth's submission that the Commissioner has an implied authority under the RCA to require production of a document that is claimed to be the subject of legal professional privilege for the limited purpose of inspecting it in order to determine whether the claim to privilege is made out. In the course of considering the proper construction of the RCA, I rejected this submission on the grounds that it is not supported by the RCA and infringes the principles enunciated in Baker and Daniels .


case_outcome: considered

case_text: The live issues in the proceeding are the two issues just mentioned, namely whether legal professional privilege attaches to Exhibit 665 having regard to the evidence before me, and whether the Commissioner had an implied or incidental power under the RCA to determine the claim for legal professional privilege. There is no issue concerning waiver; the Commonwealth took the position before me that it would not contend that any legal professional privilege attaching to Exhibit 665 had been waived by its mistaken production to the Inquiry. The Commonwealth's position in this respect is in line with settled authority: see Mann v Carnell [1999] HCA 66 ; (1999) 201 CLR 1 at 13; Director of Public Prosecutions v Kane (1997) 140 FLR 468 at 479-480 and 485-486; Goldberg v Ng [1995] HCA 39 ; (1996) 185 CLR 83 at 96-98, 109-110, 120-22; Commissioner of Police Service v Nirta [2002] 1 QdR 364; Saunders v Commissioner of the Australian Federal Police (1998) 160 ALR 469 (' Saunders' ) at 473; Hong Kong Bank of Australia Limited v Murphy [1993] 2 VR 419 at 441; Meltend Pty Ltd v Restoration Clinics of Australia Pty Ltd (1997) 75 FCR 511; and Hooker Corporation Ltd v Darling Harbour Authority (1987) 9 NSWLR 538. 25 Under s 2 of the RCA, a member of a Commission has power to summon witnesses to give evidence or to produce documents and to require a person who is not a witness to produce a document. The latter power is exercisable by notice issued pursuant to s 2(3A) , which provides: '(3A) A member of a Commission may, by written notice served (as prescribed) on a person, require the person to produce a document or thing specified in the notice to a person, and at the time and place, specified in the notice.' The notice to Dr Fuller was issued in pursuance of s 2(3A). 26 Section 3 addresses the failure of witnesses to attend and give evidence, and the failure of witnesses and other persons to produce documents. It is helpful to set out s 3 in its entirety: '(1) A person served, as prescribed, with a summons to appear as a witness at a hearing before a Commission shall not: (a) fail to attend as required by the summons; or (b) fail to attend from day to day unless excused, or released from further attendance, by a member of the Commission. Penalty: $1,000 or imprisonment for 6 months. (1A) Subsection (1) is an offence of strict liability. Note: For strict liability, see section 6.1 of the Criminal Code . (1B) Subsection (1) does not apply if the person has a reasonable excuse. (2) A person appearing as a witness at a hearing before a Commission shall not fail to produce a document or other thing that the person was required to produce by a summons under this Act served on him or her as prescribed or that the person was required to produce by the member of the Commission presiding at the hearing. Penalty: $1,000 or imprisonment for 6 months. (2A) Subsection (2) is an offence of strict liability. (2B) Subsection (2) does not apply if the person has a reasonable excuse. (3) It is a defence to a prosecution for an offence against subsection (2) constituted by a failure to produce a document or other thing to a Commission if the document or other thing was not relevant to the matters into which the Commission was inquiring. Note: A defendant bears an evidential burden in relation to the matters in subsections (1B), (2B) and (3) (see subsection 13.3(3) of the Criminal Code ). (4) A person served with a notice under subsection 2(3A) must not refuse or fail to produce a document or other thing that the person was required to produce in accordance with the notice. Penalty: $1,000 or imprisonment for 6 months. (5) Subsection (4) does not apply if the person has a reasonable excuse. (6) It is a defence to a prosecution for an offence against subsection (4) constituted by a refusal or failure to produce a document or other thing if the document or other thing was not relevant to the matters into which the Commission was inquiring. Note: A defendant bears an evidential burden in relation to the matters in subsections (5) and (6) (see subsection 13.3(3) of the Criminal Code ).' 136 In my view, the distinction between a mere reference to advice having been obtained, and a reference that discloses the content or substance of the advice, has not been eliminated by the High Court's restatement of the relevant principles as to waiver in Mann v Carnell [1999] HCA 66 ; (1999) 201 CLR 1. Gleeson CJ, Gaudron, Gummow and Callinan JJ said at 13 [29]: 'Waiver may be express or implied. Disputes as to implied waiver usually arise from the need to decide whether particular conduct is inconsistent with the maintenance of the confidentiality which the privilege is intended to protect. When an affirmative answer is given to such a question, it is sometimes said that waiver is "imputed by operation of law". This means that the law recognises the inconsistency and determines its consequences, even though such consequences may not reflect the subjective intention of the party who has lost the privilege ... What brings about the waiver is the inconsistency, which the courts, where necessary informed by considerations of fairness, perceive, between the conduct of the client and maintenance of the confidentiality; not some overriding principle of fairness operating at large.'


case_text: In Australia, legal professional privilege is a rule of substantive law that reflects an important common law immunity. In Daniels , Gleeson CJ, Gaudron, Gummow and Hayne JJ said at 552-553 [9]-[11]: 'It is now settled that legal professional privilege is a rule of substantive law which may be availed of by a person to resist the giving of information or the production of documents which would reveal communications between a client and his or her lawyer made for the dominant purpose of giving or obtaining legal advice or the provision of legal services, including representation in legal proceedings. It may here be noted that the "dominant purpose" test for legal professional privilege was recently adopted by this Court in Esso Australia Resources Ltd v Federal Commissioner of Taxation in place of the "sole purpose" test which had been applied following the decision in Grant v Downs . Being a rule of substantive law and not merely a rule of evidence, legal professional privilege is not confined to the processes of discovery and inspection and the giving of evidence in judicial proceedings. Rather and in the absence of provision to the contrary, legal professional privilege may be availed of to resist the giving of information or the production of documents in accordance with investigatory procedures of the kind for which s 155 of the Act provides. Thus, for example, it was held in Baker v Campbell , that documents to which legal professional privilege attaches could not be seized pursuant to a search warrant issued under s 10 of the Crimes Act 1914 (Cth). Legal professional privilege is not merely a rule of substantive law. It is an important common law right or, perhaps, more accurately, an important common law immunity. It is now well settled that statutory provisions are not to be construed as abrogating important common law rights, privileges and immunities in the absence of clear words or a necessary implication to that effect. That rule, the expression of which in this Court can be traced to Potter v Minahan , was the foundation for the decision in Baker v Campbell .' 58 According to the Commonwealth, the Commissioner has implied authority to require production of a document referred to in a notice under s 2(3A) for the limited purpose of inspecting it in order to determine whether the claim to legal professional privilege is made out. This submission relied on an analogy with the powers of inspection that inhere in a Court: see Grant v Downs [1976] HCA 63 ; (1976) 135 CLR 674 at 689. The Commonwealth also argued that further support could be found in the following factors. First, only a member of a Commission has the power to require production under s 2(3A) of the RCA. Secondly, a Commissioner has the same protection and immunity as Justices of the High Court in the performance of his or her duties under the RCA. Thirdly, it was said that proceedings of a Royal Commission have a quasi-judicial character, albeit they are not adversarial in nature. Reference was made to the protections afforded to witnesses and legal practitioners appearing at Commission hearings and the fact that a Commissioner who is a Judge has the power to punish for contempt in the face of the Commission: s 6O. In my opinion, none of these factors, and nothing in the RCA, supports the Commonwealth's submission. 61 In Esso Australia Resources Limited v Commissioner of Taxation [1999] HCA 67 ; (1999) 201 CLR 49 (' Esso ') at 64-65 [35], Gleeson CJ, Gaudron and Gummow JJ said: 'Legal professional privilege (or client legal privilege) protects the confidentiality of certain communications made in connection with giving or obtaining legal advice or the provision of legal services, including representation in proceedings in a court. In the ordinary course of events, citizens engage in many confidential communications, including communications with professional advisers, which are not protected from compulsory disclosure. The rationale of the privilege has been explained in a number of cases, including Baker v Campbell , and Grant v Downs itself. The privilege exists to serve the public interest in the administration of justice by encouraging full and frank disclosure by clients to their lawyers. In Waterford v The Commonwealth , Mason and Wilson JJ explained that legal professional privilege is itself the product of a balancing exercise between competing public interests and that, given the application of the privilege, no further balancing exercise is required. As Deane J expressed it in Baker v Campbell , a person should be entitled to seek and obtain legal advice in the conduct of his or her affairs, and legal assistance in and for the purposes of the conduct of actual or anticipated litigation, without the apprehension of being prejudiced by subsequent disclosure of the communication.' 63 AWB carries the onus of establishing that Exhibit 665 attracts legal professional privilege. In this Court, AWB has sought to discharge the onus by adducing evidence as to the circumstances in which the document was brought into existence and then communicated to others, by reference to the nature of the document itself, and by argument and submission. It has gone beyond, as it must, formulaic claims of the kind contained in Ms Peavey's affidavit: see Grant v Downs at 689 per Stephen, Mason and Murphy J; and Federal Commissioner of Taxation v Pratt Holdings Pty Ltd (2005) 225 ALR 266 (' FCT v Pratt Holdings' ) at 477 [30]. 105 A 'dominant purpose' is one that predominates over other purposes; it is the prevailing or paramount purpose. In FCT v Pratt Holdings, on remitter from the Full Court, Kenny J said at 279-280 [30]: '(7) The dominant purpose is not the same as the "primary" or the "substantial" purpose: see Grant v Downs at CLR 678; ALR 580 per Barwick CJ. The "dominant" purpose may be described as the ruling, prevailing, paramount or most influential purpose: see Mitsubishi Electric at [10], citing Federal Commissioner of Taxation v Spotless Services Ltd [1996] HCA 34 ; (1996) 186 CLR 404 at 416; [1996] HCA 34 ; 141 ALR 92 at 98 per Brennan CJ, Dawson, Toohey, Gaudron, Gummow and Kirby JJ. The "dominant purpose" brings within the scope of the privilege a document brought into existence for the purpose of a client being provided with professional legal services notwithstanding that some ancillary or subsidiary use of the document was contemplated at the time: Esso at 72 [58] per Gleeson CJ, Gaudron and Gummow JJ; Sparnon v Apand at FCR 328; ALR 740-1 per Branson J; and see GSA [26]-[28] per Holmes J.' 106 Kenny J also said at 478 [30] that where two purposes are of equal weight, neither is dominant in the relevant sense; hence a document is not privileged from production where one purpose for its creation is to obtain legal advice, but there is another equally important purpose. I agree. The same conclusion follows if several purposes are of roughly similar weight, and it cannot be said that one prevails over the other. In Waugh v British Railways Board [1979] UKHL 2 ; [1980] AC 521 (' Waugh' ) at 543, Lord Edmund-Davies adopted the dominant purpose test propounded by Barwick CJ in Grant v Downs , and stated that the element of clear paramountcy should be the touchstone. It is not unusual for privilege claims to fail because the evidence does not establish the requisite dominant purpose: see, eg, Kennedy v Wallace (2004) 208 ALR 424 at 444 [73]; and FCT v Pratt Holdings at 285 [44]-[46] and 287 [56]. 108 Ordinarily, the relevant purpose will be that of the author of the document in question, but this will not always be the case. In Grant v Downs , Barwick CJ said at 677: '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.' 109 In Mitsubishi Electric Pty Ltd v Victorian Workcover Authority [2002] VSCA 59 ; (2002) 4 VR 332 at 338 [14] , Batt JA (Charles and Callaway JJA concurring) said: 'As summarised by Gummow J in Hartogen Energy by reference to High Court decisions, the purpose, that is the intended use, for which a document is brought into existence is a question of fact. Ordinarily the purpose will be that of the maker of the document, but that will not always be the case, as where some other person, such as a solicitor commissioning the provision of a technical report, calls the document into existence. In that case the relevant intention will not be that of the author but the solicitor: Hartogen Energy . Likewise, in his statement of principle in Grant v Downs Barwick CJ included the dominant purpose of the person under whose direction, whether particular or general, the relevant document was produced or brought into existence.' 110 In FCT v Pratt Holdings , Kenny J observed at 278 [30], correctly in my view, that the dominant purpose must be determined objectively, having regard to the evidence, the nature of the document and the parties' submissions. Kenny J added that the evidence of the intention of the document's maker, or of the person who authorised or procured it, is not necessarily conclusive of that purpose: see GSA Industries (Aust) Pty Ltd v Constable [2002] 2 Qd R 146 (' GSA Industries' ) at 153 [28] per Holmes J; Australian Competition and Consumer Commission v Australian Safeway Stores Pty Ltd (1998) 81 FCR 526 at 545 per Goldberg J; Guinness Peat Properties Ltd v Fitzroy Robinson Partnership [1987] 1 WLR 1027 at 1036 per Slade LJ; Hartogen Energy Ltd (in liq) v Australian Gas Light Company (1992) 36 FCR 557 at 568-569 per Gummow J; and Sparnon v Apand Pty Ltd (1996) 68 FCR 322 at 328 per Branson J. As these cases make clear, it may be necessary to examine the evidence concerning the purpose of other persons involved in the hierarchy of decision-making or consultation that lead to the creation of the document and its subsequent communication. 116 Exhibit 665 is a confidential exhibit to Mr Zwier's affidavit of 5 April 2005. The exhibit was not made available to the respondents. It is well recognised that a court may examine a document over which privilege is claimed in order to ascertain whether the nature and content of the document supports the claim to legal professional privilege. In Grant v Downs, Stephen, Mason and Murphy JJ stated at 689: '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.' See also Trade Practices Commission v Sterling [1978] 36 FLR 244 (' Sterling' ) at 246 per Lockhart J. 117 I have inspected Exhibit 665. In my opinion, the character and content of the document does not provide any assistance to AWB in establishing its claim for legal professional privilege. On the contrary, it confirms my view that it was brought into existence, and was to be used, for multiple purposes, and that the two other purposes I have identified were of no lesser importance than the purpose of obtaining legal advice. 144 A traditional formulation of the second limb of legal professional privilege is that it applies to confidential communications passing between a client, the client's legal adviser and third parties for the dominant purpose of use in or in relation to litigation which is either pending or in contemplation: see FCT v Pratt Holdings at 284 [39] per Kenny J. This formulation was referred to, with apparent approval, by Finn J in the Full Court in Pratt Holdings at 360 [6]: see also Grant v Downs at 677 per Barwick CJ. 155 The traditional rationale for the litigation limb of legal professional privilege was explained by Stephen, Mason and Murphy JJ in Grant v Downs at 685: 'The rationale of this head of privilege, according to traditional doctrine, is that it promotes the public interest because it assists and enhances the administration of justice by facilitating the representation of clients by legal advisers, the law being a complex and complicated discipline. This it does by keeping secret their communications, thereby inducing the client to retain the solicitor and seek his advice, and encouraging the client to make a full and frank disclosure of the relevant circumstances to the solicitor. The existence of the privilege reflects, to the extent to which it is accorded, the paramountcy of this public interest over a more general public interest, that which requires that in the interests of a fair trial litigation should be conducted on the footing that all relevant documentary evidence is available. As a head of privilege legal professional privilege is so firmly entrenched in the law that it is not to be exorcised by judicial decision. None the less there are powerful considerations which suggest that the privilege should be confined within strict limits.'


case_text: In Esso Australia Resources Limited v Commissioner of Taxation [1999] HCA 67 ; (1999) 201 CLR 49 (' Esso ') at 64-65 [35], Gleeson CJ, Gaudron and Gummow JJ said: 'Legal professional privilege (or client legal privilege) protects the confidentiality of certain communications made in connection with giving or obtaining legal advice or the provision of legal services, including representation in proceedings in a court. In the ordinary course of events, citizens engage in many confidential communications, including communications with professional advisers, which are not protected from compulsory disclosure. The rationale of the privilege has been explained in a number of cases, including Baker v Campbell , and Grant v Downs itself. The privilege exists to serve the public interest in the administration of justice by encouraging full and frank disclosure by clients to their lawyers. In Waterford v The Commonwealth , Mason and Wilson JJ explained that legal professional privilege is itself the product of a balancing exercise between competing public interests and that, given the application of the privilege, no further balancing exercise is required. As Deane J expressed it in Baker v Campbell , a person should be entitled to seek and obtain legal advice in the conduct of his or her affairs, and legal assistance in and for the purposes of the conduct of actual or anticipated litigation, without the apprehension of being prejudiced by subsequent disclosure of the communication.' 111 In the usual case, the question will be whether the requisite dominant purpose existed at the time the document was brought into existence. In some cases, however, intentions may shift between the time when the document was commissioned or created or communicated: see GSA Industries at 153-154 [29]-[34]; and Esso at 77 per McHugh J. In GSA Industries , Holmes J observed at 154 [34] that, on the basis that the communication and not the document is the subject of privilege, it is arguable that a time later than the creation of the document may be relevant. This kind of difficulty does not arise in the present case. It is not suggested by either party that Mr Lindberg's intentions, or those of any other party relevant to the creation or communication of Exhibit 665, changed between the time when Mr Lindberg drafted the statement of contrition and the time when it was communicated by email to those who had participated in the telephone conference of 21 December 2005. 157 In Pratt Holdings , Stone J concluded that the High Court's exposition of legal professional privilege in Daniels , Esso and other cases demonstrates that it is supported by a single rationale which applies to both litigation privilege and legal advice privilege: at 381 [85]. Merkel J agreed with this conclusion. However, Stone J added that the existence of a single rationale does not mean that it is no longer necessary to have regard to the different categories of legal advice and litigation privilege. Finn J did not find it necessary to decide whether legal professional privilege should now be recognised as a unified doctrine which, though having two applications (ie advice and litigation), has a single rationale. His Honour regarded this controversy as a well recognised one and observed that, at an appropriate level of abstraction, a common and unifying rationale can be found for both manifestations of the privilege: at 361 [9]. 159 AWB also relied upon the broad terms in which legal professional privilege was expressed in the joint judgments in Daniels at 552 [9] and Esso at 64 [35]. In the latter case, Gleeson CJ, Gaudron and Gummow JJ said that the privilege protects the confidentiality of certain communications made in connection with the provision of legal services, including representation in proceedings in a court. AWB also referred to s 119 of the Evidence Act 1995 (Cth) which refers to 'professional legal services relating to an Australian or overseas proceeding'. In my opinion, these matters do not support the extension of litigation privilege to the context of a commission of inquiry. In Daniels and Esso, the High Court was trying to describe the scope of the privilege in a summary way. The description recognises that in appropriate cases the privilege can extend beyond legal advice to include other forms of legal work. It would be wrong to infer from the High Court's summary statement that it was intending to radically enlarge the operation of the rule. And in my view the language used in s 119 does not disclose any intention to extend litigation privilege to the conduct of a commission of inquiry.


case_outcome: approved

case_text: AWB carries the onus of establishing that Exhibit 665 attracts legal professional privilege. In this Court, AWB has sought to discharge the onus by adducing evidence as to the circumstances in which the document was brought into existence and then communicated to others, by reference to the nature of the document itself, and by argument and submission. It has gone beyond, as it must, formulaic claims of the kind contained in Ms Peavey's affidavit: see Grant v Downs at 689 per Stephen, Mason and Murphy J; and Federal Commissioner of Taxation v Pratt Holdings Pty Ltd (2005) 225 ALR 266 (' FCT v Pratt Holdings' ) at 477 [30]. 107 The authorities accept that an appropriate starting point when applying the dominant purpose test is to ask what was the intended use or uses of the document which accounted for it being brought into existence: see Pratt Holdings Pty Ltd v Commissioner of Taxation [2004] FCAFC 122 ; (2004) 136 FCR 357 (' Pratt Holdings' ) at 366 [35] per Finn J. I would add that where the document is immediately communicated by its author to several other persons, including the author's legal adviser, by a circular email (which is the case here), it is also important to ask what was the dominant purpose of that email communication. 144 A traditional formulation of the second limb of legal professional privilege is that it applies to confidential communications passing between a client, the client's legal adviser and third parties for the dominant purpose of use in or in relation to litigation which is either pending or in contemplation: see FCT v Pratt Holdings at 284 [39] per Kenny J. This formulation was referred to, with apparent approval, by Finn J in the Full Court in Pratt Holdings at 360 [6]: see also Grant v Downs at 677 per Barwick CJ. 157 In Pratt Holdings , Stone J concluded that the High Court's exposition of legal professional privilege in Daniels , Esso and other cases demonstrates that it is supported by a single rationale which applies to both litigation privilege and legal advice privilege: at 381 [85]. Merkel J agreed with this conclusion. However, Stone J added that the existence of a single rationale does not mean that it is no longer necessary to have regard to the different categories of legal advice and litigation privilege. Finn J did not find it necessary to decide whether legal professional privilege should now be recognised as a unified doctrine which, though having two applications (ie advice and litigation), has a single rationale. His Honour regarded this controversy as a well recognised one and observed that, at an appropriate level of abstraction, a common and unifying rationale can be found for both manifestations of the privilege: at 361 [9]. 158 Legal professional privilege must be applied in a manner which is consistent with the policy reasons that justify its existence: see Pratt Holdings at 362 [18] and 367-368 [41]-[42] per Finn J, and 386 [105] per Stone J; and Three Rivers at 650 [35]. But this does not mean that the origins, and the distinctive scope and operation of the second limb of the privilege, are to be ignored. In my view, the authorities establish that the reason why litigation privilege has been recognised as a substantive rule of law and as a fundamental right, is that it operates to secure a fair civil or criminal trial within our adversarial system of justice. The rationale for litigation privilege does not support its extension to a commission of inquiry.


case_title: Balabel v Air India [1988] 1 Ch 317

case_text: In Balabel v Air India [1988] 1 Ch 317 (' Balabel' ), Taylor LJ (Parker LJ and Lord Donaldson MR agreeing) said that it goes too far to extend legal advice privilege without limit to all solicitor and client communications upon matters within the ordinary business of a solicitor and referable to that relationship. In his Lordship's view, the correct test is whether the communication or other document was made confidentially for the purposes of legal advice. Taylor LJ then continued at 330: 'Those purposes have to be construed broadly. Privilege obviously attaches to a document conveying legal advice from solicitor to client and to a specific request from the client for such advice. But it does not follow that all other communications between them lack privilege. In most solicitor and client relationships, especially where a transaction involves protracted dealings, advice may be required or appropriate on matters great or small at various stages. There will be a continuum of communication and meetings between the solicitor and client. The negotiations for a lease such as occurred in the present case are only one example. Where information is passed by the solicitor or client to the other as part of the continuum aimed at keeping both informed so that advice may be sought and given as required, privilege will attach. A letter from the client containing information may end with such words as "please advise me what I should do". But, even if it does not, there will usually be implied in the relationship an overall expectation that the solicitor will at each stage, whether asked specifically or not, tender appropriate advice. Moreover, legal advice is not confined to telling the client the law; it must include advice as to what should prudently and sensibly be done in the relevant legal context.' 87 This analysis, especially the concluding words, must be understood in the context of the case. Balabel concerned documents which were brought into existence for the purposes of the solicitor's conduct of a commercial leasing transaction. The trial judge had held that privilege only attached to documents which actually seek or convey advice, and did not extend to two other categories of documents relating to the lease, namely communications between the client and its solicitors, and draft working papers, attendance notes and memoranda of the solicitors: at 323. 88 The approach explained by Taylor LJ in Balabel has been followed in subsequent cases. In Nederlandse Reassurantie Groep Holding NV v Bacon & Woodrow [1995] 1 All ER 976 (' NRG' ), the action concerned a negligence claim brought by a Dutch corporation against various parties who had advised it in connection with a share purchase transaction. In the course of discovery, the plaintiff disclosed a bill of costs from its solicitors in respect of work carried out in relation to the share purchase transaction. One of the defendants claimed that the bill of costs showed that the solicitors were providing not only legal advice but advice of a more general nature going to the commercial advisability of the share purchase transaction. They sought specific discovery of communications passing between the plaintiff and its solicitors. Colman J rejected the claim. In doing so, Colman J said that Balabel had not disturbed well accepted principles concerning the scope of legal professional privilege (at 983): 'However, legal professional privilege only attaches to such communications as pass between the solicitor and client which are brought into existence or occur in the course of the performance of the solicitor's professional duty or function as solicitor retained to give professional advice, as distinct from some other capacity unrelated to the giving of legal professional advice (see Minter v Priest [1930] AC 558 esp at 581-586 per Lord Atkin). The substance of the scope of the privilege as identified by Taylor LJ in Balabel v Air India [1988] 2 All ER 246, [1988] Ch 317 does not, in my view, disturb or modify what has been clear law since Minter v Priest , namely that if a solicitor is instructed for the purpose of getting legal advice in relation to a particular transaction or series of transactions, then all the communications between the solicitor and the client relating to that transaction will be privileged notwithstanding they do not contain advice on matters of law or construction, provided that they are directly related to the performance by the solicitor of his professional duty as legal adviser of the client.' 91 The House of Lords overturned the decision of the Court of Appeal. It held that the documents at issue were the subject of legal advice privilege. All of their Lordships endorsed Taylor LJ's statement in Balabel that legal advice is not confined to telling the client the law but also includes advice as to what should prudently and sensibly be done in the relevant legal context. 92 It is sufficient for present purposes to refer to several passages in the speeches of Lord Scott of Foscote, Lord Rodger of Earlsferry, Lord Carswell and Lord Brown of Eaton-under-Heywood. 93 Lord Scott said at 652-653 [43] that: 'The preparation of the evidence to be submitted and the submissions to be made to the inquiry on behalf of the Bank were for the purpose of enhancing the Bank's prospects of persuading the inquiry that its discharge of its public law obligations under the Banking Acts in relation to BCCI was not deserving of criticism and had been reasonable in the circumstances. The presentational advice given by Freshfields and counsel for that purpose was advice "as to what should prudently and sensibly be done in the relevant legal context": Balabel v Air India [1988] Ch 317, 330. The "relevant legal context" was the Bingham Inquiry and the question whether the Bank had properly discharged its public law duties under the Banking Acts. The presentational advice falls, in my opinion, squarely within the policy reasons underlying legal advice privilege.' A little later Lord Scott said at 653 [44]: 'The skills of professional lawyers when advising a client what evidence to place before an inquiry and how to present the client and his story to the inquiry in the most favourable light are, in my opinion, unquestionably legal skills being applied in a relevant legal context.' 94 Lord Rodger distinguished the situation which would arise if the Bank consulted other professionals, including 'the modern equivalent of a rhetorician', on how to present the Bank's position and evidence to the inquiry: at 658 [59]. His Lordship then said at 658 [60]: 'When, however, the [Bank] consulted the lawyers in Freshfields, and through them counsel, about the presentation of their evidence to the inquiry, it was not seeking their comments and assistance as bankers, accountants, rhetoricians or anything else: it was seeking their comments and assistance as lawyers professing expertise in the field. Either expressly or impliedly, the [Bank] was asking them to put on legal spectacles when reading, considering and commenting on the drafts. In other words it was asking them to consider, as lawyers, how the Bank's evidence could be most effectively presented to Bingham LJ, given that he was inquiring into the Bank's discharge of their legal responsibilities under the Banking Acts. Such advice could come in many forms. ... What matters is that the [Bank] was instructing the lawyers in Freshfields to carry out a function which necessarily involved the use of their legal skills if it was to be performed properly. The communications between the [Bank] and Freshfields were therefore concerned with obtaining "legal advice" in the broader sense in which, as Taylor LJ rightly said in Balabel v Air India , that term should be understood for this purpose. It follows that legal advice privilege applies to those communications. The appeal must be allowed.' 95 Lord Carswell said at 681 [114]: 'The work of advising a client on the most suitable approach to adopt, assembling material for presentation of his case and taking statements which set out the relevant material in an orderly fashion and omit the irrelevant is to my mind the classic exercise of one of the lawyer's skills. I can see no valid reason why that should cease to be so because the forum is an inquiry or other tribunal which is not a court of law, provided that the advice is given in a legal context: see Lord Scott's opinion at para 42.' 96 Lord Brown said at 683 [120]: 'I think it clear that legal advice privilege attaches to the communications between the Bank and its lawyers concerning the preparation of the Bank's overarching statement (the statement of its case to the Bingham Inquiry). I would go so far as to state as a general principle that the process by which a client seeks and obtains his lawyer's assistance in the presentation of his case for the purposes of any formal inquiry whether concerned with public law or private law issues, whether adversarial or inquisitorial in form, whether held in public or in private, whether or not directly affecting his rights or liabilities attracts legal advice privilege. Such assistance to my mind clearly has the character of legal business. It is precisely the sort of professional service for which lawyers are ordinarily employed by virtue of their expertise and experience.' 97 In Australia, in Dalleagles Pty Ltd v Australian Securities Commission (1991) 4 WAR 325 (' Dalleagles' ), Anderson J rejected the argument that legal advice privilege only extended to what is literally either legal advice or a request for legal advice, and arrived at much the same position as Taylor LJ enunciated in Balabel . At 332-333, Anderson J said: 'I do not think the authorities provide justification for concluding that the doctrine of legal professional privilege as applying to non-curial communications between solicitor and client has been refined to the extent submitted by counsel for the defendants, which would require professional communications to be excluded from the protection of privilege unless expressed as advice simpliciter or as a request for such advice or unless forming part of a communication expressed in that way. But anyway, I think it is the case that whenever a lay client gives instructions to a legal practitioner to perform specialist legal services involving the exercise of professional skill, there is imposed on the solicitor a duty to give any advice reasonably necessary to protect the client's interests in the transaction whether expressly requested or not. Two cases in this Court illustrating that rule are Watts v Public Trustee (WA) [1980] WAR 97 and Stone James & Co v Investment Holdings Pty Ltd [1987] WAR 363: see also Macpherson v Kevin J Prunty & Associates [1983] 1 VR 573. It is not a large step from that position to say that whenever a client gives instructions to his solicitor there is assumed to be a request for advice. In my opinion, discourse between solicitor and client with reference to the transactions covered by those instructions, that is, professional discourse in a professional capacity, should be regarded as prima facie for the purpose of giving and receiving advice. This would apply to any communication that is on its face a communication of a professional nature from the solicitor to the client or his agent touching the subject matter of the solicitor's engagement and any communication from the client to the solicitor in connection with that engagement. Only if the rule is applied in that way can the policy of it be carried out and its object practically fulfilled.' Anderson J went on to say that there are limits to the application of this principle, including the fact that the material in question must have been created for the purpose of fulfilling the solicitor's professional engagement: at 334. 98 In DSE (Holdings) Pty Ltd v Intertan Inc [2003] FCA 1191 ; (2003) 135 FCR 151 (' DSE' ), Allsop J followed Dalleagles and Balabel , and said that he saw no difference of substance between them: at 173 [71]. But Allsop J made it clear that he did not consider that these cases extended legal professional privilege beyond legal advice (at 165 [45]): 'I do not read the reasons of Taylor LJ as extending the privilege beyond legal advice. The reasoning of Taylor LJ was clearly directed to the privilege being so limited. What legal advice is, however, goes beyond formal advice as to the law. This recognition does not see the privilege extend to pure commercial advice. In any given circumstance, however, it may be impossible to disentangle the lawyer's views of the legal framework from other reasons that all go to make up the "advice as to what should prudently and sensibly be done in the relevant legal framework" (Taylor LJ in Balabel at 330). That is how I read this last cited paragraph of Colman J: not extending the privilege beyond legal advice to commercial advice, but as recognising the form and nature of advice in a practical day to day context.' The last sentence in this passage refers to the statement by Colman J in NRG at 983 that a solicitor's professional duty or function not infrequently relates to the commercial wisdom of entering into a given transaction in relation to which legal advice is also sought. 99 Allsop J's judgment contains an extensive review of the cases which have referred to, and applied, the reasoning of Taylor J in Balabel . They include Saunders , in which French J said that the principle applied by Anderson J in Dalleagles extends to materials brought into existence by the client in order to communicate with the solicitor for purposes which would attract privilege: at 472. In Wenkart v Australian Federal Police (unreported, Branson J, 11 November 1986) (' Wenkart' ), Branson J cited Dalleagles for the proposition that 'professional discourse in a professional capacity, with reference to transactions covered by a retainer to provide legal advice, will be regarded as prima facie for the purpose of giving and receiving advice'. 101 There are, however, two additional points to be made. First, to qualify as privileged, the lawyer's advice must satisfy the description of professional advice given by a lawyer in his or her capacity as such: see NRG at 982 [g]-[j]; Three Rivers at 651 [38] and 658 [59]-[60]. The same requirement exists in the United States: see JH Wigmore, Evidence in Trials at Common Law , vol 8, rev J McNaughton, Little Brown & Company, 1961 (1981) at s 2292; and Evans v City of Chicago 231 FRD 302 (ND Ill 2005). Secondly, communications for the purpose of obtaining and giving legal advice in the sense discussed in Balabel and the other cases mentioned above must satisfy the dominant purpose test if they are to attract legal professional privilege.


case_text: The approach explained by Taylor LJ in Balabel has been followed in subsequent cases. In Nederlandse Reassurantie Groep Holding NV v Bacon & Woodrow [1995] 1 All ER 976 (' NRG' ), the action concerned a negligence claim brought by a Dutch corporation against various parties who had advised it in connection with a share purchase transaction. In the course of discovery, the plaintiff disclosed a bill of costs from its solicitors in respect of work carried out in relation to the share purchase transaction. One of the defendants claimed that the bill of costs showed that the solicitors were providing not only legal advice but advice of a more general nature going to the commercial advisability of the share purchase transaction. They sought specific discovery of communications passing between the plaintiff and its solicitors. Colman J rejected the claim. In doing so, Colman J said that Balabel had not disturbed well accepted principles concerning the scope of legal professional privilege (at 983): 'However, legal professional privilege only attaches to such communications as pass between the solicitor and client which are brought into existence or occur in the course of the performance of the solicitor's professional duty or function as solicitor retained to give professional advice, as distinct from some other capacity unrelated to the giving of legal professional advice (see Minter v Priest [1930] AC 558 esp at 581-586 per Lord Atkin). The substance of the scope of the privilege as identified by Taylor LJ in Balabel v Air India [1988] 2 All ER 246, [1988] Ch 317 does not, in my view, disturb or modify what has been clear law since Minter v Priest , namely that if a solicitor is instructed for the purpose of getting legal advice in relation to a particular transaction or series of transactions, then all the communications between the solicitor and the client relating to that transaction will be privileged notwithstanding they do not contain advice on matters of law or construction, provided that they are directly related to the performance by the solicitor of his professional duty as legal adviser of the client.'