Re Harvey Albert Maynard Dingle and Jennifer Frances Dingle v Commonwealth Development Bank of Australia and Commonwealth Development Bank of Australia (Cross Applicant) and Harvey Albert Maynard Dingle and Jennifer Frances Dingle (Cross Respondents) N [1989] FCA 499 (8 December 1989)

FEDERAL COURT OF AUSTRALIA

Re: HARVEY ALBERT MAYNARD DINGLE and JENNIFER FRANCES DINGLE
And: COMMONWEALTH DEVELOPMENT BANK OF AUSTRALIA and COMMONWEALTH
DEVELOPMENT BANK OF AUSTRALIA (Cross Applicant) and HARVEY ALBERT
MAYNARD DINGLE and JENNIFER FRANCES DINGLE (Cross Respondents)
No. QLD G35 of 1989
FED No. 773
Practice and Procedure
91 ALR 239
23 FCR 63

COURT

IN THE FEDERAL COURT OF AUSTRALIA
QUEENSLAND DISTRICT REGISTRY
GENERAL DIVISION
Pincus J.(1)

CATCHWORDS

Practice and Procedure - subpoena - subpoena duces tecum - legal professional privilege - previous suit involving the third party - whether statements taken for first suit privileged in this suit - scope of legal professional privilege in Australia - relevance of confidentiality of communication.

Trade Practices Act 1974, ss.87(1A), 87(1B)

Federal Court Rules O.15 r.7

Harvey Albert Maynard Dingle & Anor v. Commonwealth Development Bank of Australia Qld G35 of 1989

HEARING

BRISBANE
8:12:1989

Counsel for the respondent: Mr A.J.H. Morris

Solicitors for the respondent: Morris Fletcher and Cross

Counsel for the Trade Practices Commission: Mr P.E. Hack

Solicitor for the Trade Practices Commission: Australian Government Solicitor

ORDER

THE COURT DIRECTS THAT:

1. the Trade Practices Commission need not produce the
documents subpoenaed from it, insofar as legal
professional privilege has been claimed in respect
of them;
2. the privileged documents be returned to the Trade
Practices Commission;

THE COURT ORDERS THAT:
3. the parties' solicitors may inspect the non-
privileged subpoenaed documents;
4. the respondent bank pay the Trade Practices
Commission's costs of and incidental to compliance
with the subpoena, to be taxed;
5. those costs be costs in the proceedings as between
the applicants and the respondent bank.

NOTE: Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.

DECISION

A subpoena has been issued by the respondent bank to an official of the Trade Practices Commission requiring production of certain documents and the Commission applies to set the subpoena aside. To enable the solicitor issuing the subpoena properly to identify the documents, the Commission has allowed access to its files, subject to an undertaking on the part of the solicitor, designed to protect confidentiality.

2. The Commission's attack on the subpoena seeks to avoid the necessity of producing certain documents on the ground of legal professional privilege and others on the ground of lack of relevance.

3. As to the former, the respondent bank says that any privilege which existed has been waived by the inspection. That seems to me plainly not to be so, and I find it unnecessary to discuss the waiver point further.

4. The question of protection of the documents by legal professional privilege is not quite so easily disposed of. The Commission has explained by its counsel, Mr Hack, that the documents in question are notes and the like which may, for present purposes, be equated to statements taken from potential witnesses. The litigation to which they related has been partially heard and is reported: Trade Practices Commission v. Frendship Aloe Vera Pty Ltd (1988) 82 ALR 557. At the conclusion of that hearing, I made certain findings in favour of the applicant (which was the Commission to which the subpoena here in question is directed) under s.87(1A) of the Trade Practices Act 1974; s.87(1B) contemplates that, such findings having been made, the Commission may then apply for relief on behalf of individuals. I gather that this later stage is unlikely to be pursued since the parties against which the findings were made are insolvent. It is convenient to call the reported case just discussed the "first suit" and it should be noted that the parties in the present proceeding against the bank ("the second suit") were not parties to the first suit.

5. The second suit is a claim concerned with the same basic subject matter as the first. The applicants in the second suit are persons, mentioned in the reasons for judgment in that case, who seek to recover damages from the respondent bank on the basis of alleged misleading conduct and the like; the applicants say that the bank is responsible for losses they incurred in entering into the aloe vera venture mentioned in my reasons in the previous litigation.

6. In view of the concession by Mr Hack as to their nature, it seems unnecessary to discuss the question of whether I should myself examine the documents the subject of the claim of legal professional privilege; they are said to be protected as statements taken for the purposes of the first suit.

7. Counsel for the bank says that there is no such protection, for two reasons: first, because this is a different case, and secondly because the first suit is at least substantially at an end. Counsel argues that, if one has regard to the scope and purpose of the privilege as defined by the High Court, the statements taken for the first suit cannot be protected, at this stage, in the second suit.

8. Although there is much in the cases to support the Commission's claim that the documents from the first suit are privileged in the second suit, it is not quite clear whether that is the position in this country; further, it is not even clear whether the claim is properly described as one of legal professional privilege. Suppose a party wishes to obtain access in a second suit to information one of the parties in a previous suit has obtained from a potential witness, either through a solicitor or directly. Particularly in the former case - e.g. where a party's solicitor (perhaps without the client's knowledge) has simply taken a statement from or obtained information from a person with a view to litigation - it is not easy to see why the information should be regarded as protected as if it were a confidential communication between solicitor and client. The information obtained by the solicitor may not be, indeed often will not be, used in the litigation on behalf of the client, or even divulged to the client. Yet there is authority that the client has, at least in general, a right to prevent others having access to that information, either in documentary or oral form.

9. What is the basis of that right? The question has importance because if the basis is purely legal professional privilege of the kind dealt with in Grant v. Downs [1976] HCA 63; (1976) 135 CLR 674, and the subsequent discussions of that privilege in O'Reilly v. The Commissioners of the State Bank of Victoria [1983] HCA 47; (1983) 153 CLR 1 and Baker v. Campbell [1983] HCA 39; (1983) 153 CLR 52, then Australian law's protection of such information may not have survived the expression of these definitions of the scope of legal professional privilege.

10. There has been much discussion as to the extent to which the statements of principle in these three cases, and particularly in the first, were intended to be exhaustive of the subject with which they deal. It seems to me desirable, although the relevant passages are no doubt familiar, to refer at least in a summary way to the statements which are most relevant to the present problem. In Grant v. Downs [1976] HCA 63; 135 CLR 674 at p 685, it was explained that, according to traditional doctrine, the rationale of the relevant head of privilege is to promote the public interest by facilitating the representation of clients by legal advisers. "This it does by keeping secret their communications ..." (p 685). That rationale does not cover information gathered from third parties for the purposes of the case; such information has to be gathered whether or not the party is represented by a lawyer. In O'Reilly v. Commissioners of the State Bank of Victoria 153 CLR at p 22, Mason J. (as he then was) described legal professional privilege as protecting "from disclosure by the solicitor, in the absence of the consent of the client, confidential communications between the two ..." Again, if that is a complete description, it cannot cover communications (for the purposes of preparing a case) between the solicitor and a third party, or between the client and a third party. Mason J., on the same page, reiterates that, to be privileged, communications must be "confidential communications between the solicitor and client ..." Gibbs C.J. referred in his reasons to those of Mason and Wilson JJ. concerning privilege and said he could not "usefully add to what they have said on the matter" (p 14). In Baker v. Campbell, statements by a number of members of the Court tended to emphasise the foundation of privilege in the notion of confidentiality between solicitor and client: see per Wilson J. at p 95, per Deane J. at p 112 and per Dawson J. at p 122. Of these expressions of view, the most significant for present purposes is the last because Dawson J. was concerned to explain that "communications to which legal professional privilege attaches are closely confined".

11. If one were free to ignore these general statements as to the scope of legal professional privilege, the structure of the relevant rules would be fairly clear. Material gathered by the solicitor or client in preparation for litigation is privileged as if it were a confidential communication between solicitor and client, even if it is not such a communication; the existence of the relevant privilege does not depend upon there being any relevant communication in fact between the solicitor and client or persons acting on their behalf: Wheeler v. Le Marchant (1881) 17 ChD 675, Nickmar Pty Ltd v. Preservatrice Skandia Insurance Ltd (1985) 3 NSWLR 44 at p 56, Dubai Bank Ltd v. Galadari (1989) 3 WLR 1044 at 1047. The privilege is not that of the person (potential witness or otherwise) who supplied the information; it is a matter for the client whether or not the privilege is waived: Schneider v. Leigh (1955) 2 QB 195. The rule "once privileged always privileged" applies; the privilege is permanent: Pearce v. Foster (1885) 15 QBD 114 at 119.

12. In Grant v. Downs the principal judgment did not expressly accept the validity of the principle underlying the privilege, insofar as it was thought to be based upon encouraging people to use lawyers in litigation. It would seem odd, and one might say unjust, if information collected by an unrepresented party in a case were discoverable, whereas corresponding information collected by his represented opponent's solicitor were not discoverable. But leaving that consideration aside, the difficulty about this body of doctrine, insofar as it protects communications other than between solicitor and client, is simply that it is not defensible as preserving the confidentiality of communications between solicitor and client. For that reason, the relevant rules may, in the end, be held to be more soundly based on a separate and narrower principle, namely that a party is not in general bound to reveal to the Court statements taken from witnesses and the like for the purposes of litigation: see Baker v. Campbell at p 66 per Gibbs C.J. and at p 75 per Mason J. That principle was expressed by James LJ. in Anderson v. Bank of British Columbia (1876) 2 ChD 644 at p 656: "... that as you have no right to see your adversary's brief, you have no right to see that which comes into existence merely as the materials for the brief". Then in Buttes Gas and Oil Co. v. Hammer (No. 3) (1981) 1 QB 223 at 243, Lord Denning M.R. distinguished between legal professional privilege "properly so called" and "communications which at their inception come into existence with the dominant purpose of being used in aid of pending or contemplated litigation". It should be added that another possible means of protection of witness statements and the like is the privilege for documents relating solely to one's own case: but see O.15 r.7 of the Federal Court Rules.

13. The kind of case in which the problem is likely to be important is one in which, in preparation for a suit between A and B, A's solicitor takes a statement from a potential witness, C. Then, in a later suit between C and D, the question whether the statement (perhaps an important admission) made by C can be got into evidence depends not upon balancing the confidentiality of the statement against any other consideration, but simply upon A's will or whim. It is not easy to see why allowing access to the statement in the second suit should be thought necessarily to interfere with any interest in A which requires protection, at least if the first suit is concluded.

14. It appears to me, however, that the general statements made in the three High Court cases cannot be said to be clearly inconsistent with the rather unattractive body of doctrine I have summarized above. Further, although the applicants in the second suit here cannot be legally identified with the applicant in the first suit (the Commission), the first suit was brought at least largely in their interests and their position may be said to be analogous to that of clients of the Commission's solicitor. I accordingly uphold the claim to legal professional privilege.

15. The remaining point is that production of some of the documents was objected to on the ground that they are claimed to be irrelevant in the second suit. It was suggested by counsel that I should inspect the documents to see if they are properly so described. In my opinion, a Court should not ordinarily undertake that task. The question is whether to permit the subpoena to stand would be to sanction an abuse of the Court's process: Purnell Bros Pty Ltd v. Transport Engineers Pty Ltd (1984) 73 FLR 160 at p 175. In that case, the subpoena was set aside partly on the ground that the document "could not ... be relevant to any issue which might legitimately arise ..." (p 175). It does not appear to me to accord with the practice of Court that, if an objection to producing documents on subpoena is taken on the ground of relevance, the Court should necessarily consider each document one by one to see if it appears to be relevant. The question whether all or any of the documents can get into evidence is, of course, another matter. There is nothing to suggest that the issue of the subpoena here was an abuse of process.

16. I will direct that the Trade Practices Commission need not produce the documents subpoenaed from it, insofar as legal professional privilege has been claimed in respect of them and that the privileged documents be returned to the Commission. I do not propose to make any other order on the notice of motion except to order that the parties' solicitors may inspect the documents which have been subpoenaed, insofar as not privileged, and that the bank must pay the Commission's costs of and incidental to compliance with the subpoena, to be taxed; those costs will be costs in the proceedings as between the applicants and the respondent bank.