Dianne Maria Tarrant v Myer Stores Pty Ltd T/As Grace Bros [1995] ACTSC 81 (21 July 1995)

SUPREME COURT OF THE ACT

DIANNE MARIA TARRANT v. MYER STORES PTY. LTD t/as GRACE BROS.
No. SC 691 of 1992
Number of pages - 5
Practice and Procedure

COURT

IN THE SUPREME COURT OF THE AUSTRALIAN CAPITAL TERRITORY
MASTER A HOGAN

CATCHWORDS

Practice and Procedure - Inspection of document produced on subpoena - Legal Professional Privilege - Sole Purpose Test - Worker's compensation - Circumstantial investigation report to insurer.

Grant v Downs [1976] HCA 63; (1976) 135 CLR 674
Baker v Campbell [1983] HCA 39; (1983) 49 ALR 385

Evidence Act 1995 (Cth) ss.117(1), 118, 119, 120

HEARING

CANBERRA, 16 June 1995
21:7:1995

Counsel for the Third Party: Mr B. Meagher

Instructing Solicitors: Hunt and Hunt

Counsel for the Defendant: Mr R. Refshauge

Instructing Solicitors: Sly and Weigall

ORDER

1. The subpoenaed document is not the subject of legal professional privilege, and must be produced for inspection by the Third Party.
2. The Defendant is to pay the costs of this application.

DECISION

MASTER A HOGAN This is the determination of an objection by a party to litigation to the inspection by another party of a document produced to the Court on the return of a subpoena for production.

2. In an action in this Court the plaintiff has sued the defendant, her employer, for damages for personal injury that she alleges she sustained on 17 July 1990, when she slipped on a wet tiled floor at her place of work.

3. The defendant issued a Third Party Notice claiming contribution or indemnity from the cleaning company which it employed to clean the premises where the plaintiff sustained her injury.

4. The defendant was insured against its liability for worker's compensation and claims by its employees for common law damages by C.E. Heath Casualty and General Insurance Ltd. ("Heath").

5. On 23 July 1990 the plaintiff lodged a claim for workers compensation, which the defendant referred to Heath. Liability for worker's compensation was accepted, and compensation payments were commenced on 21 August 1990.

6. On 29 October 1990 Miss Van de Laarschot, a claims manager then employed by Heath, issued instructions to Lee Kelly and Associates, an inquiry agent. The initial instruction was by fax, and read, "Could you please do a circumstantial investigation into the incident enclosed."

7. The instruction was confirmed by letter dated 5 November 1990, the relevant part of which read, "We -- write to confirm our facsimile dated 29.10.90 to undertake a circumstantial investigation, and in particular your opinion as to whether this claim has any common law potential."

8. Lee Kelly and Associates made an investigation, and submitted a report, dated 27 November 1990, to Heath.

9. That report has been produced to the Court in answer to a subpoena. Counsel for the Third Party sought leave to inspect it. Objection to its inspection is taken by the defendant, based on a claim to legal professional privilege.

10. The plaintiff issued the Writ in the action on 29 September 1992. There is no evidence that in October or November 1990 she had intimated any intention, to the defendant or to Heath, to institute a claim for damages at common law.

11. In support of the claim for privilege Miss Van de Laarschot swore an affidavit, on which she was cross examined. Paragraph 4 of that affidavit read as follows:

"4. On 29 October 1990 I issued instructions to Lee Kelly and
Associates Pty Limited to undertake an investigation into the
circumstances of the claim. I formed the opinion that the claim
had common law potential. Annexed hereto and marked "B" is a true
copy of the letter of instructions and the fax referred to therein.
Those instructions were issued after liability for workers'
compensation payments had been accepted and payments had commenced
and the investigation was not instigated by me to assess workers'
compensation liability as that had been admitted. The purpose for
the investigation was to obtain information for contemplated
litigation at common law including the recovery of compensation
payments made by the Defendant."

12. In cross examination she agreed that one of the purposes that could be served by a circumstantial report might be the making of a decision whether to apply under the Worker's Compensation Act to terminate payments of compensation to a worker. Usually such a decision would be made on the basis of medical evidence, rather than evidence about the circumstances of the accident.

13. It was also possible that a circumstantial report might be used in deciding whether or not to negotiate with a worker to effect a redemption of a claim, both for compensation and common law damages.

14. Those were general possibilities. Dealing with this particular report, Miss Van de Laarschot gave evidence to the following effect.

1. At the time she requested the report there was no common law
claim on foot.
2. One possible result of receiving the report could have been an
indication that there was not any risk of a common law claim against
the insured.
3. Another possible result could have been an indication that there
was some common law risk.
4. A third possible result could have been in indication that there
was a possibility of recovery from a third party, or that there was
no such possibility.
5. What she would do on receiving the report depended upon what it
contained.
6. If the report gave reason to do so, it could be submitted to
legal advisers.
7. At the time she ordered the report the plaintiff was no longer
receiving compensation payments, as she had returned to work.
8. In this case nothing happened until the plaintiff commenced
proceedings.
9. At the time she ordered the report, on the basis of the
information she already had, she assumed that common law proceedings
were at least possible.
10. When ordering the report she had two purposes in mind. One was
to see if there was any possibility of recovery and the other was to
see if there was any common law potential.

15. She was not asked, and did not say, whether, in making either of those decisions, she would never, sometimes, usually or always seek legal advice.

16. Obviously, when proceedings were brought, the report was part of the material that was placed before the defendant's legal advisers.

17. Although there was no direct evidence about it, I infer from the lapse of time that if the plaintiff had not commenced proceedings against the defendant Heath would not have caused the defendant to bring proceedings for recovery against the Third Party.

18. This case does raise for decision the question of the relevant test for deciding whether a document such as this is the subject of legal professional privilege.

19. At common law in Australia that privilege has, since 1976, been confined to documents which are brought into existence for the sole purpose of their being submitted to legal advisers, for advice or for use in legal proceedings: Grant v Downs [1976] HCA 63; (1976) 135 CLR 674.

20. However, the law of evidence in the Courts of this Territory is now governed by the Evidence Act 1995 (Cth) which has, in certain circumstances, substituted the "dominant purpose" test. The relevant sections are ss. 118, 119 and 120, which are in the following terms:

Legal advice
118. Evidence is not to be adduced if, on objection by a client,
the court finds that adducing the evidence would result in
disclosure of:
(a) a confidential communication made between the client and a
lawyer; or
(b) a confidential communication made between 2 or more lawyers
acting for the client; or
(c) the contents of a confidential document (whether delivered or
not) prepared by the client or a lawyer;
for the dominant purpose of the lawyer, or one or more of the
lawyers, providing legal advice to the client.
Litigation
119. Evidence is not to be adduced if, on objection by a client,
the court finds that adducing the evidence would result in
disclosure of:
(a) a confidential communication between the client and another
person, or between a lawyer acting for the client and another
person, that was made or

(b) the contents of a confidential document (whether delivered or
not) that was prepared;
for the dominant purpose of the client being provided with
professional legal services relating to an Australian or overseas
proceeding (including the proceeding before the court), or an
anticipated or pending Australian or overseas proceeding in which
the client is or may be, or was or might have been, a party.
Unrepresented parties
120.(1) evidence is not to be adduced if, on objection by a party
who is not represented in the proceeding by a lawyer, the court
finds that adducing the evidence would result in disclosure of:
(a) a confidential communication between the party and another
person; or
(b) the contents of a confidential document (whether delivered or
not) that was prepared, either by or at the direction or request
of, the party;
for the dominant purpose of preparing for or conducting the
proceeding.
(2) In this section a reference to a party includes a reference to
a person who is, in relation to the party, a person of a kind
referred to, in relation to a client, in paragraphs (b), (d), (e)
and (f) of the definition of "client" in subsection 117(1).

21. Section 117 provides definitions of "client" and "party" as follows:

117.(1) In this Division:
"client: includes the following:
(a) an employer (not being a lawyer) of a lawyer;
(b) an employee or agent of a client;
(c) an employer of a lawyer if the employer is:
(i) the Commonwealth or a State or Territory; or
(ii) a body established by a law of the Commonwealth or a State
or Territory;
(d) if, under a law of a State or Territory relating to persons of
unsound mind, a manager, committee or person (however described) is
for the time being acting in respect of the person, estate or
property of a client - a manager, committee or person so acting;
(e) if a client has died - a personal representative of the client;
(f) a successor to the rights and obligations of a client, being
rights and obligations in respect of which a confidential
communication was made.
"party" includes the following:
(a) an employee or agent of a party;
(b) if, under a law of a State or Territory relating to persons of
unsound mind a manager, committee or person (however described) is
for the time being acting in respect of the person, estate or
property of a party - a manager, committee or person so acting;
(c) if a party has died - a personal representative of the party;
(d) a successor to the rights and obligations of a party, being
rights and obligations in respect of which a confidential
communication was made.

22. I leave to another case a discussion of the question whether the relationship between a "party" and a "client" so defined and the insurer of a party or client is such that the Act affects the admissibility of documents prepared at the request of, or communications with, the insurer.

23. For the present case it is sufficient for me to hold, as I do, that the Evidence Act 1995 (Cth) alters the purpose test only when what is in issue is whether "evidence is not to be adduced."

24. As Baker v Campbell [1983] HCA 39; (1983) 49 ALR 385 made clear, the doctrine of legal professional privilege operates in many contexts other than the admissibility of evidence in Court.

25. In my opinion, therefore, in the context of inspection of documents, whether produced in answer to a subpoena or listed on discovery, the test whether legal professional privilege applies is that of the common law, namely, the "sole purpose" test laid down in Grant v Downs (supra).

26. In applying that test to the facts of this case, it is important to note that the purpose of bringing a document into existence must be more specific than that the document will be used in making a decision about pending or potential litigation. Its sole purpose must be that it is to be submitted to legal advisers, in order that the legal advisers may give some advice, or use it in legal proceedings, either already instituted or in contemplation.

27. The evidence in this case does not extend that far. The report was primarily to be read by the insurer's claims manager. Depending on what it contained, she might then undoubtedly decide, in some circumstances, to submit it to lawyers for advice. So far as the evidence in this case goes, however, she might decide to do nothing. She might make her own decision about the action to be taken, without the need for obtaining legal advice about it, or about the facts disclosed in it. Simply because it was not to be used to decide liability for worker's compensation, which had already been admitted, and that common law or recovery proceedings were a possible outcome of the circumstances that the document was to contain, does not mean that the sole purpose in the commissioning of the document was that it be submitted to lawyers for advice or use in pending litigation.

28. In my opinion the document was not the subject of legal professional privilege. I direct that it be produced for inspection by the Third Party.

29. I order the defendant to pay the costs of this application.