Catalina Norma D'Ambrosio v Berkeley Challenge Pty Limited [1997] ACTSC 35 (15 May 1997)

SUPREME COURT OF THE ACT

CATALINA NORMA D'AMBROSIO v. BERKELEY CHALLENGE PTY LIMITED
No. SC283 of 1995
Number of pages - 7
Practice and Procedure

COURT

IN THE SUPREME COURT OF THE AUSTRALIAN CAPITAL TERRITORY

MILES CJ

CATCHWORDS

Practice and Procedure - production and inspection of documents - privileged documents under s.119 Evidence Act 1995 (Cth) and hence under O.34 r.1A Supreme Court Rules (ACT) - employment-related personal injury claim - whether correspondence between the defendant's insurer and a doctor, and between the defendant's insurer and an investigator, is privileged - test whether the correspondence was prepared for the dominant purpose of obtaining advice in anticipated litigation as opposed to obtaining information which may lead to litigation - test not satisfied.

Supreme Court Rules (ACT), O.34 r.1A

Evidence Act 1995 (Cth), ss.117 and 119

Grant v. Downs [1976] HCA 63; (1976) 135 CLR 674

English Supreme Court Practice (1988 edition) Vol.1, pp.419-420

Guinness Peat Properties Ltd and others v. Fitzroy Robinson Partnership [1987] 2 All ER 716

Warner v. The Women's Hospital [1954] VLR 410

Westminster Airways LD. v. Kuwait Oil Co. LD. [1951] 1 KB 134

Alfred Crompton Amusement Machines Ltd v. Customs and Excise Commissioners (No. 2) [1974] AC 405

HEARING

CANBERRA, 18 April 1997 (hearing), 15 May 1997 (decision)

15:5:1997

Counsel for the plaintiff/appellant: Mr. B.J. Salmon, QC

Solicitors for the plaintiff/appellant: Clayton Utz

Counsel for the defendant/respondent: Ms. E.J. Godtschalk

Solicitors for the defendant/respondent: Hickson Lakeman & Holcombe

ORDER

THE COURT ORDERS THAT:

1. The appeal be upheld and the Master's orders of 13 December 1996 be set aside.

2. The defendant/respondent within 14 days from today produce to the plaintiff/appellant or her solicitors and allow the inspection of the documents numbered 6, 7, 13 and 15 referred to in Part 2 of Schedule 1 to the affidavit of Drago Brozinic, sworn 4 November 1996.

3. The defendant/respondent pay the plaintiff/appellant's costs of the appeal and of the proceedings before the Master.

DECISION

MILES CJ

1. This is an appeal from a decision of the Master on 13 December 1996 dismissing an application by the plaintiff for inspection of certain documents identified in the defendant's affidavit as to documents and in respect of which the defendant claimed privilege. The Master gave no reasons and apparently was not asked to do so. The appeal raises a short but important point under O.34 r.1A of the Supreme Court Rules and under s.119 of the Evidence Act 1995 (the Act). Order 34 r.1A provides in part as follows:

"Privileged documents 1A. For the purposes of this Order, a document is privileged from production only if it is - (a) a document of which evidence could not be adduced, or could not be adduced over the objection of any person, by reason of the operation of Part 3.10 (other than sections 128 and 130) of the Evidence Act 1995 of the Commonwealth; ....."

Section 119 of the Act provides as follows:

"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."

2. It is common ground that if the documents in question would be inadmissible under s.119 then they are privileged under O.34 r.1A(a).

3. The plaintiff sues for damages for personal injury sustained whilst in the employ of the defendant in early August 1993 and on 20 September 1993 at the Tuggeranong Hyperdome. The statement of claim dated 5 May 1995 alleges that on the earlier occasion, whilst attempting to steady a trolley stuck in a grate in order to prevent it from falling over, she experienced neck pain radiating into her right arm and fingers. The statement of claim further alleges that on the latter occasion she fell on a floor made slippery with water and ice. In respect of both injuries she alleges negligence on the part of the defendant by way of its breach of duty as employer to take reasonable care for the safety of the plaintiff. In its defence filed 22 September 1995 the defendant denies that the incidents occurred as alleged (but, curiously, does not deny the general allegation of breach of duty in para.6 of the statement of claim). The defendant also raises contributory negligence.

4. The defendant's affidavit as to documents was sworn on 4 November 1996 by Drago Brozinic, Regional Manager, and is in a conventional form. Mr. Brozinic deposes that the defendant has in its possession, custody or power certain documents which are "enumerated" or described in Schedule 1 to the affidavit. Objection is raised to the production of the documents described in Part 2 of Schedule 1 on the ground that "the documents are subject to legal professional privilege as appears from their description".

5. The dispute over production and inspection relates at this stage only to the following documents described in Part 2 of Schedule 1:

Number Description Date 6 Report of Columbia Investigations Pty. Ltd. 1 July 1994

7 Report of Columbia Investigations Pty. Ltd. 23 June 1994

13 Report of Dr G. Griffith 17 June 1994

15 Page 8 of a report from Dr G. Griffith 17 June 1994

6. Contrary to the assertion in the affidavit, the description does not of itself prove or indicate that the documents attract legal professional privilege or any other sort of privilege. It is as well to remember what was said by Stephen, Mason and Murphy JJ in Grant v. Downs [1976] HCA 63; (1976) 135 CLR 674 at 689:

"[The Court] needs to scrutinize with care claims of privilege made on the ground now under consideration. It is for the party claiming privilege to show that the documents for which the claim is made are privileged. He may succeed in achieving this objective by pointing to the nature of the documents or by evidence describing the circumstances in which they were brought into existence. But it should not be thought that the privilege is necessarily or conclusively established by resort to any verbal formula or ritual."

7. This aspect is dealt with in the affidavit of Anthony Peter Urquhart, sworn 3 April 1997 and filed in opposition to the plaintiff's application for an order compelling inspection. Mr. Urquhart deposes that he is and was at all material times the Regional Claims Manager for the ACT and south-western region of New South Wales of MMI General Insurance Limited, the insurer of the defendant for the purposes of the Workers' Compensation Act 1951 (ACT) and claims for damages at common law for employment-related injuries.

8. The evidence of Mr. Urquhart (which is not challenged) is that the defendant received on 23 May 1994 the following documents:

1. Worker's compensation claim form completed by the plaintiff in respect of the incident on 20 September 1993;

2. Employer's report in respect of the same injury;

3. Copy letter dated 16 March 1994 from the plaintiff's solicitors to the defendant referring to both incidents and the plaintiff's resignation on 24 October 1993;

4. Copy letter dated 11 May 1994 from the plaintiff's solicitors to the defendant enclosing compensation form dated 10 May 1994 and other documents.

9. A claims officer who has since left the employ of the insurer completed a request for a medical report on 27 May 1994 and forwarded it to Dr Griffith of Canberra Medico-Legal Consultants. On 3 June 1994 the same officer requested that Columbia Investigations conduct a factual investigation of the incidents.

10. Subsequently the insurer obtained a report from Dr Griffith dated 17 June 1994 and reports from Columbia Investigations dated 23 June 1994 and 1 July 1994.

11. Mr. Urquhart further deposed and gave oral evidence in cross-examination to the effect that the claims officer's action was taken in pursuance of a practice on the part of the insurer to investigate workers' compensation claims which bore all or some of the following characteristics:

- Apparently serious injuries reflected in need for ambulance transport to hospital.

- Claims not made until some months after injury.

- "Slip and fall" claims (whether on employer's premises or otherwise).

Mr. Urquhart also said that claims in the latter two categories were treated as suspicious.

Issues

12. The appeal was argued on the tacit assumption (presumably correct) that O.34 r.1A and s.119 apply to the objection to production made in the defendant's affidavit as to documents. However, it is to be noted that the precise objection is upon the ground of "legal professional privilege". Whilst prior to the Evidence Act 1995 (Cth) that particular ground was available, the Rules of Court were amended in 1996 so as to accord with the provisions of the Act. The Act has abolished the relevant parts of the common law as to privilege and replaced them with a series of provisions which make up Part 3.10 of the Act. It is to the terms of the Act, and in particular to s.119, that regard must be had. The cases decided on common law privilege should be approached with caution and may be of little assistance.

13. Nevertheless, the issue for decision in the present appeal appears to me to be identified in the English Supreme Court Practice (1988 edition) Vol.1, pp.419-420. The text (from an earlier edition) was referred to by Slade LJ, giving the judgment of the Court of Appeal in Guinness Peat Properties Ltd and others v. Fitzroy Robinson Partnership [1987] 2 All ER 716 at 721:

"The law is neither clear nor settled as to the circumstances in which documents embodying reports from communications with a non-professional servant, agent or third party are privileged. The general principle is that such documents are privileged if, and only if, coming into existence for the purpose of obtaining legal advice in existing or anticipated proceedings (see the cases summarised in the judgment of Havers J in Seabrook v. British Transport Commission [1959] 2 All ER 15, [1959] 1 WLR 509). The application of this test is easy enough in straightforward cases; this privilege will clearly extend to communications for such purposes made to a solicitor through an agent, and to information obtained from a third party at the request of a solicitor to enable him to enforce or resist a claim by legal proceedings. But great difficulties have arisen (a) in determining the status of documents coming into existence for more than one purpose, and (b) in deciding at what stage it can fairly be said that any such purpose is obtaining advice in anticipated litigation, as contrasted with obtaining information as to an occurrence which may lead to litigation. ....."

14. As to the difficulty referred to in para.(a), the Act clearly provides an answer, at least in part. Where documents are prepared for more than one purpose, it is the dominant purpose which is the test and not, as was previously the case, the sole purpose. In this regard, the Act appears to adopt the minority view of Barwick CJ in Grant v. Downs at 677:

"... 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."

15. The factual question whether the relevant purpose is dominant, however, is another matter, which itself may give rise to difficulties on the facts. I shall return to it, because it is a live issue between the parties to the appeal.

16. The difficulty referred to in para.(b) is a substantial one in the present matter. The English cases discussed in the Supreme Court Practice are said there to be inconsistent. Some of them were examined by Sholl J in Warner v. The Women's Hospital [1954] VLR 410. No precise criteria seem to have emerged and every case would appear to depend on the circumstances. For instance, in Westminster Airways LD. v. Kuwait Oil Co. LD. [1951] 1 KB 134, it was held that a communication between a defendant and an insurer following substantial damage to an aircraft was well within the privileged area. At 146 Jenkins LJ said:

"... the very fact that the insurance company are communicated with at all indicates that a claim is anticipated. Moreover, in the present case the circumstances were such that there could be no doubt, even before a formal claim was lodged, that a claim would ensue. Prima facie, in such circumstances a communication between the assured and the insurance company, whether direct or through the assured's brokers, would be directed to the question whether the claim should be disputed or admitted, and if it was to be disputed, how best to conduct the defence."

17. In contrast, in Alfred Crompton Amusement Machines Ltd v. Customs and Excise Commissioners (No. 2) [1974] AC 405, the House of Lords held that legal professional privilege did not apply to internal memoranda recorded by customs officers for the initial purpose of valuation as it was not until after the valuations were made that litigation was reasonably anticipated.

18. One returns in hope then to the provisions of the Australian legislation. The key provisions for present purposes are the disclosure of:

"(a) a confidential communication between 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 anticipated or pending Australian or overseas proceeding, in which the client is or may be, or was or might have been, a party".

19. "Confidential communication" is defined under sub-s.117(1) to mean

"a communication made in such circumstances that, when it was made: (a) the person who made it; or (b) the person to whom it was made; was under an express or implied obligation not to disclose its contents, whether or not the obligation arises under law."

20. "Confidential document" receives a similar definition.

21. Also under s.117(1) a client is defined to include an agent of a client.

22. In view of these definitions, the provisions of s.119 apply to confidential communications or confidential documents passing between the defendant and third parties such as the defendant's insurer so long as they are made or prepared for the specified dominant purpose. In view of the definition of "client", it is not so clear that they apply as between the defendant's insurer and inquiry agents or a doctor instructed by the insurer unless the insurer (or the inquiry agent or doctor) is regarded as the client's agent. However, that was not a point taken on the appeal or, so it seems, before the Master and it seems to have been assumed by both parties that the insurer was the agent or alter ego of the client in question, that is, the defendant. I will proceed on that assumption.

23. It is to be observed that the test to be applied for ascertaining the dominant purpose, or whether a particular purpose was dominant, is an objective test in all the circumstances and is not confined to the subjective intention of the person or persons preparing the document: Guinness Peat Properties Ltd at 723-724.

24. I was not asked to inspect the documents in question and can only draw inferences as to their nature and purpose from their description in the affidavit as to documents and the circumstances already referred to.

25. On the information before me, the reasons which led to the documents coming into existence were likely to be several in number: for instance, to ascertain whether the event giving rise to the plaintiff's alleged injury had occurred at all, whether the plaintiff had suffered the type of injury she claimed to have suffered, whether any injury was as serious as she alleged, or had the consequences which she alleged. Several purposes were probably subsumed into an overall purpose made implicit in Mr. Urquhart's affidavit, namely, checking the bona fides of the plaintiff's claim having regard to the delay in making the claim and the apparent relative ease with which "slip and fall" claims may be made. Implicit also is the purpose of seeking legal advice, but only, as it seems to me, in the event of the claim going beyond a simple claim for a relatively minor injury for a short period of disability in circumstances clearly established. Experience (or perhaps hope) suggests that insurers meet many, perhaps the majority, of claims for workers' compensation without recourse to advice from lawyers. There is nothing in the evidence as to the likelihood of a worker's compensation claim such as that in the present case leading to the insurer seeking legal advice either as to the claim made for compensation or as to any claim that might be made then or at some later time for common law damages. On the state of the evidence I am not satisfied that those questions were likely to be decided only by reference to a lawyer in the light of the results of the investigation and the medical consultation which the insurer sought. On the evidence the defendant has not discharged the onus of showing that the coming into being of the confidential communications or documents passing between the insurer on the one hand and the investigators and the doctor on the other hand was for the dominant purpose of the defendant being provided with professional legal advice relating to an anticipated legal proceeding in which the defendant might be or might have been a party.

26. In those circumstances the claim for client legal privilege under s.119 of the Act and therefore under O.34 r.1A(a) must fail. The appeal is upheld. The Master's orders of 13 December 1996 are set aside and in lieu thereof the following orders are made:

1. The defendant/respondent within 14 days from today produce to the plaintiff/appellant or her solicitors and allow the inspection of the documents numbered 6, 7, 13 and 15 referred to in Part 2 of Schedule 1 to the affidavit of Drago Brozinic, sworn 4 November 1996.

2. The defendant/respondent is to pay the plaintiff/appellant's costs of the appeal and of the proceedings before the Master.