State of New South Wales v Jackson [2007] NSWCA 279 (10 October 2007)

Last Updated: 12 October 2007

NEW SOUTH WALES COURT OF APPEAL

CITATION: State of New South Wales v Jackson [2007] NSWCA 279


FILE NUMBER(S):
40183/07

HEARING DATE(S): 23 July 2007

JUDGMENT DATE: 10 October 2007

PARTIES:
State of New South Wales - Claimant/Appellant
Christopher Jackson (by his next friend Melissa Jackson) - Opponent/Respondent


JUDGMENT OF: Mason P Beazley JA Giles JA

LOWER COURT JURISDICTION: District Court

LOWER COURT FILE NUMBER(S): DC 560/06 (Newcastle)

LOWER COURT JUDICIAL OFFICER: Sidis DCJ

LOWER COURT DATE OF DECISION: 29 March 2007

LOWER COURT MEDIUM NEUTRAL CITATION:
Christoper Jackson (by his next friend Melissa Jackson) v State of New South Wales, Sidis DCJ, 29 March 2007, unreported.

COUNSEL:
R W Seton SC - Appellant
D T Kennedy SC & C Hart - Respondent

SOLICITORS:
Hicksons Lawyers - Appellant
Bale Boshev Lawyers - Respondent

CATCHWORDS:
PRIVILEGE - client legal privilege - school accident - accident form completed by teacher - teacher obtained statements from witnesses - whether statements were confidential documents within meaning in Evidence Act 1995 - consideration of implied obligation not to disclose contents - no obligation - not confidential documents - whether court will inspect documents for which privilege claimed - can inspect and did so because might have contained something material to confidentiality - whether dominant purpose of provision of professional legal services relating to anticipated proceedings - consideration of when proceedings are anticipated - was the dominant purpose - but statements not privileged because not confidential documents.

LEGISLATION CITED:
Evidence Act 1995, Div 1 Pt 3.10

CASES CITED:
Amalgamated Television Services Ltd v Marsden [1999] NSWCA 97;
Australian Competition and Consumer Commission v Australian Safeway Stores Pty Ltd (1998) 81 FCR 526;
Australian Competition and Consumer Commission v Rural Press Ltd [1999] FCA 1847; (2000) 96 FCR 141;
AWB Ltd v Cole [2006] FCA 571; (2006) 152 FCR 382;
Bulk Materials (Coal Handling) Services Pty Ltd v Coal and Allied Operations Pty Ltd (1998) 13 NSWLR 689;
Carnell v Mann (1998) 89 FCR 247;
Cataldi v Commissioner for Government Transport (1970) 1 NSWLR 65;
Drabsch v Switzerland General Insurance Co Ltd [1999] NSWSC 975;
Esso Australia Resources Ltd v Commissioner of Taxation [1999] HCA 67; (1999) 201 CLR 49;
Fagan v State of New South Wales [2004] NSWCA 182;
Federal Commissioner of Taxation v Pratt Holdings Pty Ltd [2005] FCA 1247; (2005) 60 ATR 466;
General Accident Assurance Company v Chrusz (1999) 180 DLR (4th) 241;
Grant v Downs [1976] HCA 63; (1976) 135 CLR 674;
Harmony Shipping Co v Saudi Europe Line (1979) 1 WLR 1380;
J-Corp Pty Ltd v Australian Builders Labourers Federated Union of Workers (1992) 110 ALR 510;
Mallalla District Council v Livestock Markets Ltd [2006] SASC 80; (2006) 94 SASR 258;
Mann v Carnell [1999] HCA 66; (1999) 201 CLR 1;
Mitsubishi Electric Australia Pty Ltd v Victorian WorkCover Authority [2002] VSCA 59; (2002) 4 VR 332;
Newcastle Wallsend Coal Co Pty Ltd v Court of Coal Mines Regulation (1997) 42 NSWLR 351;
Nickmar Pty Ltd v Preservatrice Skandia Insurance Ltd (1985) 3 NSWLR 44;
Ritz Hotel Ltd v Charles of the Ritz Ltd (No 22) (1988) 14 NSWLR 132;
Seven Network Ltd v News Ltd [2005] FCA 864;
Seven Network Ltd v News Ltd [2005] FCAFC 125;
Sydney Airports Corporation Ltd v Singapore Airlines Ltd [2005] NSWCA 47;
Tooheys Ltd v Housing Commission of New South Wales (1952) 20 LGR 236;
Trade Practices Commission v Sterling [1979] FCA 33; (1979) 36 FLR 244;
Rickard Constructions Pty Ltd v Rickard Hails Moretti Pty Ltd [2006] NSWSC 234;
Warner v Women's Hospital (1954) VLR 410;
Woollahra Municipal Council v Westpac Banking Corporation (1994) 33 NSWLR 529.

DECISION:
Appeal dismissed with costs.


JUDGMENT:

IN THE SUPREME COURT
OF NEW SOUTH WALES
COURT OF APPEAL

CA 40183/07

DC 560/06 (Newcastle)

MASON P

BEAZLEY JA

GILES JA

Wednesday 10 October 2007

STATE OF NEW SOUTH WALES v JACKSON

Judgment

1 MASON P: I agree with Giles JA.

2 BEAZLEY JA: I agree with Giles JA.

3 GILES JA: The respondent was a student at Glendale Technology High School. He was injured in an accident on a trampoline during a PDHPE class. The teacher, Mr Koen Harman, said that he was “reminded” by “a senior member of staff” to complete an Accident to School Student form, write out a statement, and obtain written statements from two witnesses, a student teacher Ms Jessica Jackson (no relation) and a student Luke Blenman. The senior member of staff gave the Accident to School Student form to Mr Harman.

4 Mr Harman said that he gave the completed documents (“the documents”) to “the Deputy Principal and my Senior Head Teacher”. I take this to have been the one person, but Mr Harman later referred to giving the documents to “the School Executive” and whatever he did with the documents may be taken to have had that objective.

5 The respondent brought proceedings against the appellant in the District Court, claiming damages in respect of his injury. He issued a subpoena addressed to “Glendale Technology High School” requiring production of “the complete file for” himself. This was irregular: the school was not a legal entity, and a subpoena should not be used in lieu of discovery of documents. The appellant nonetheless produced the file. But it opposed inspection of the documents, which formed part of the file, on the ground of client legal privilege.

6 Sidis DCJ upheld the privilege in respect of the Accident to School Student form and Mr Harman’s statement, but rejected it in respect of the statements of Ms Jackson and Luke Blenman. Her Honour ordered that the lastmentioned statements be made available for inspection by the respondent.

7 The appellant’s application for leave to appeal was heard on full submissions as if an appeal. At the conclusion of the hearing the Court granted leave to appeal. For the reasons which follow, in my opinion the statements of Ms Jackson and Luke Blenman were not entitled to client legal privilege. The appeal should be dismissed.

Client legal privilege

8 The claim to client legal privilege rested upon the provisions of Div 1 of Pt 3.10 of the Evidence Act 1995 (“the Act”). At least on appeal, the appellant relied on both s 118 and s 119. They provide -

“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.

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.”

9 By the definitions in s 117(1) “client” includes an agent or employee of a client. Other definitions are -

“confidential communication means 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.”

“confidential document means a document prepared in such circumstances that, when it was prepared:

(a) the person who prepared it, or

(b) the person for whom it was prepared,

was under an express or implied obligation not to disclose its contents, whether or not the obligation arises under law.”

10 The appellant’s claim to legal professional privilege was not made by way of objection to adduction of evidence. Save for the rule next mentioned, common law principles of legal professional privilege would apply rather than client legal privilege under the Act: Mann v Carnell [1999] HCA 66; (1999) 201 CLR 1; Esso Australia Resources Ltd v Commissioner of Taxation [1999] HCA 67; (1999) 201 CLR 49. However, by Pt 1 r 9 of the UCP Rules objection to “production” of a subpoenaed document may be taken on the ground that it is a privileged document, which by the definition in the Dictionary includes a document that contains information of which evidence could not be adduced over objection. Privilege in relation to production of documents on subpoena is thus aligned with privilege in relation to adducing evidence. No point was taken that it appears that the documents were produced by the appellant and its objection was to their inspection.

11 Privilege under s 118 is not available, if for no other reason than because the statements of Ms Jackson and Luke Blenman were not prepared by the client (the Department) or a lawyer. On the evidence, apart from inspection of the statements, there is no reason to conclude other than that they were physically prepared by Ms Jackson and Luke Blenman (Australian Competition and Consumer Commission v Rural Press Ltd [1999] FCA 1847; (2000) 96 FCR 141 at [12]- [21], in relation to s 157 of the Trade Practices Act 1974 but applicable to s 118). Inspection of the statements, as later mentioned, makes plain that they were physically prepared by Ms Jackson and Luke Blenman. Section 119 is the relevant provision, together with the definition of “confidential document”.

The evidence

The respondent was aged 13 or 14 at the time of the accident. He alleged in his statement of claim that on or about 28 June 2005 he was undertaking a sports/physical education lesson in which he was directed to use a trampoline, and that after jumping on the trampoline as directed he “came into collision with a brick wall, causing injury, loss and damage”. The particulars of negligence included that the place was inherently unsafe for a trampolining program (sic) and that the trampoline was placed near a brick wall. The particulars of loss, injury and damage included a left frontal extradural haemorrhage, necessity for craniotomy and removal of part of the skull, and that the respondent’s ADHD condition was aggravated and he suffered anxiety and depression. It was alleged that the respondent’s injury “contributed to a more negative trajectory workwise”, and “caus[ed] a diminution of his earning capacity on the open market”.

12 In the District Court the appellant read an affidavit affirmed by Mr Harman and tendered a document entitled “Reporting School Accidents” (“the policy document”). Mr Harman was not cross-examined, and the tender of the policy document was not opposed. It became Exhibit A. The respondent led no evidence.

13 The policy document was published by the New South Wales Department of Education and Training and bore the “implementation date” of 16 September 2002. Paragraph 1, headed “Abstract”, said that the “policy” outlined the purpose of school accident reports and the responsibilities of principals and school staff in relation to the completion, storage and use of school accident reports and provision of information concerning accidents to parents and students. Paragraph 3 said that it replaced a section of a Teachers Handbook and part of a Memorandum to Principals.

14 The policy document stated in para 4, headed “Context”, that the Department was subject to claims for compensation arising from accidents in schools or during school activities, that the claims may involve litigation, and that the Department’s ability to properly consider and/or defend claims depended to a significant degree on the information in school accident reports. It said in para 6.1 that a report should be prepared for any non-trivial accident on school premises or during school activities. The substance of paras 6.2 and 6.3 was that the report should preferably be prepared by a senior member of staff who had not been involved in the incident, that it should contain information of particular kinds, and that witness statements should be obtained from any person, including a student, with knowledge of the incident. Guidance was provided for obtaining witness statements. Para 6.4 described other documents to be collected and kept with the accident report. By para 6.5, accident reports were to be retained for seven years or until the injured person reached twenty-five, whichever was the longer.

15 Para 6.6 provided -

“6.6 Purpose of accident reports

School accident reports play a crucial role in the Department’s assessment of, and any subsequent defence to, claims made against it by students and visitors.

Some accidents occurring on school premises or during school activities result in claims for compensation for personal injury or damage to property. Sometimes there is a considerable period of time between the date of the accident and the date of a claim being made.

Accident reports will assist the Department in assessing its liability with respect to an accident that has occurred to a student or visitor.”

16 By para 6.7, principals were to ensure that parents and caregivers were notified of any accident involving a student under eighteen, and information to be provided was outlined.

17 Paragraph 6.8 provided -

“6.8 Access to information

A copy of a witness statement may be provided to the person who made the statement if requested.

Parents and care-givers may also be provided with a copy of any statement made by their child.

A lawyer who is representing a student or visitor is entitled to the same level of access as the person he or she is acting for. For example a solicitor acting for a student may be given a copy of a witness statement made by that student.

A request by any person, except the Department’s own legal representatives, for a copy of another person’s witness statement or for the accident report should be refused.”

18 It was stated in para 6.9 that accident reports had legal professional privilege. Forms for an accident report and for statements by a staff member and by a student were attached to the policy document. The accident report form had at its end, “For use of the Department’s legal advisers in anticipation of legal proceedings”. Each form contained as a privacy notice -

“The information provided on this form is being obtained for the purpose of ascertaining the details of the accident. It will be used by the Department of Education and Training for the purpose of obtaining legal advice as to any liability it may have arising out of the accident, and for use in the course of any litigation that may eventuate. This information will be stored securely. You may correct any personal information provided at this time by contacting the school.”

19 The policy document ended with a form for a “Checklist”, with boxes to be ticked for notifying parents or carers, completing an accident report and so on. The Checklist form also concluded, “For use of the Department’s legal advisers in anticipation of legal proceedings”.

20 In his affidavit Mr Harman said, after recounting completion of the documents and to whom he gave them in no more expansive terms than I have indicated -

“8. At the time I completed the documents and obtained the statements referred to in paragraph 6 herein I understood that the reasons for preparing and obtaining the documents and giving them to the School Executive were that -

a. when there is an accident involving a school child the child may take legal action;

b. I recall being told that the child may take action until they are 24 or for seven years after the incident and it is therefore necessary to obtain and keep records of the incident for some time;

c. in the event of a claim by the child, the documents would be used by the Department of Education and Training and its lawyers to defend legal proceedings;

d. I was aware of the requirement to record and store those documents before I commenced employment at Glendale Technology High School and I believe that I was instructed about the reason for the documents being obtained while I was at university.”

21 Mr Harman did not relate the requirement to record and store the documents to the policy document or any predecessor to the policy document. Para 5 of the policy document stated that principals were “required to ensure that all staff are conversant with the requirements of the policy and that school accident reports are prepared and maintained in accordance with the relevant provisions.” Mr Harman did not say whether or not he had been made conversant with the requirements of the policy, but what he did was consistent with it and with at least general knowledge of its contents or those of a predecessor.

22 It is evident from the judge’s reasons, and from the transcript of the course of argument, that she had read the documents. How that came about is not clear. It may be inferred that the Accident to School Student form given to Mr Harman bore the notation about use in anticipation of legal proceedings and the privacy notice. The evidence did not indicate whether forms as attached to the policy document were used for the various statements. That could be determined only from inspection. The judge did not say one way or the other.

23 There was some debate on appeal over this Court reading the documents. The appellant was content that the Court should read the documents, and a copy of the documents was provided. The respondent preferred that the Court should not do so, since if it did the Court would have regard to material which was not known to him and on which he could not make submissions.

24 In ruling on a claim to legal professional privilege or client legal privilege the court may inspect the relevant documents (Grant v Downs [1976] HCA 63; (1976) 135 CLR 674 at 677, 688-9; Trade Practices Commission v Sterling [1979] FCA 33; (1979) 36 FLR 244 at 246-7; Woollahra Municipal Council v Westpac Banking Corporation (1994) 33 NSWLR 529 at 541-2; Esso Australia Resources Ltd v Commissioner of Taxation at [52]; AWB Ltd v Cole [2006] FCA 571; (2006) 152 FCR 382 at 391; see also s 133 of the Act). Inspection is discretionary (Grant v Downs at 688-9; Mallalla District Council v Livestock Markets Ltd [2006] SASC 80; (2006) 94 SASR 258 at [30]), for such assistance as it may provide in arriving at the documents’ status. In Esso Australia Resources Ltd v Commissioner of Taxation at [52] Gleeson CJ and Gaudron and Gummow JJ said, after observing that a claim for privilege is not conclusively established by use of a verbal formula, that a court “should not be hesitant to exercise” its power to examine documents. Where the parties have put evidence before the court, however, beyond the use of a verbal formula, I respectfully remain of the view expressed in Woollahra Municipal Council v Westpac Banking Corporation at 542, that the court should not unnecessarily pay regard to material which can not be known to the party challenging the claim to privilege.

25 In the present case I have concluded that the documents should be inspected, and have done so. The reason for inspection is that, it is as described later in these reasons, necessary to decide whether or not the statements of Ms Jackson and Luke Blenman were prepared in such circumstances that when they were prepared the Department, or Ms Jackson or Luke Blenman, was under an express or implied obligation not to disclose their contents. The statements might have borne something on their face material to confidentiality; for example, they might have been on a form for statements containing a privacy notice in accordance with the policy document. The Court should not come to its decision without ascertaining the position.

26 The statements are on plain pieces of paper, without anything material to confidentiality. They appear to be in the writing of Ms Jackson and Luke Blenman, and so physically prepared by them.

The judge’s reasons

27 The judge described the claim for privilege as one based on Mr Harman’s affidavit “in which he deposes that he was instructed to make a record in the form now before me for the purposes of defending any legal proceedings that might be brought”. She referred to parts of the policy document, which she described as having been provided “[i]n support of Mr Harman”.

28 Her Honour then said -

“In my view whilst the reports [sic] have the protection of privilege I do not think that that privilege extends to statements made by persons who witnessed the incident concerned. My view is the general principle is that there is no property in a witness. In this case I do not see how there can be property in any statement made by a witness.

I am very concerned at the approach taken by the document, exhibit A, in that it makes no reference to the reporting of school accidents for the purpose of identifying whether remedial action is required to be taken for the protection of the school children concerned. It strains credibility to suggest that the dominant purpose for the reporting of school accidents arises from the need to defend legal proceedings. In particular I note that the document, exhibit A, is in a different form to that which was considered by his Honour Judge Robison in Chan v State of New South Wales, where a dual purpose was identified. It appears that the document has been amended since the date of Judge Robison’s decision.

The result is that I uphold the claim for privilege in respect of the document headed ‘Accident to School Student” and the accident report [sic] of Mr Harman which appears to be an addendum to that accident report. In my view privilege does not extend to the statements of Jessica Jackson and Luke Blenman and those documents will be made available for inspection by the plaintiff.”

29 The reasons are, with respect, not as explanatory of the decision as is desirable. There is no reference to material provisions of the Act, nor are there other than implicit findings as to the documents being confidential documents and the purpose of their preparation. Regard to the transcript of the hearing before her Honour does not add to an understanding of the reasons.

30 The respondent submitted that in the second of the paragraphs set out above the judge had declined to accept that the documents were prepared for a dominant purpose affording privilege under s 119 of the Act. That can not be correct, since her Honour clearly enough had dominant purpose in mind and upheld the privilege in respect of the accident report and the statement of Mr Harman. The concern expressed by her Honour in the second of the paragraphs was not translated to a finding that the dominant purpose was a purpose other than the need to defend legal proceedings. In my opinion, the judge accepted that the documents were prepared for the dominant purpose of the Department being provided with advice and representation in relation to anticipated proceedings.

31 Although upholding the privilege in respect of the accident report and Mr Harman’s statement, the judge considered that the statements of Ms Jackson and Luke Blenman were in a different position whereby the privilege did not extend to them. (The anomaly that the judge appears to have regarded Mr Harman’s statement as part of the accident report, although it also was a statement made by a person who witnessed the accident, may be noted but need not be further considered.) It is not clear whether this was because in her Honour’s view she did not think that the witness statements were confidential documents within the definition in the Act, or because in her Honour’s view the principle that there can be no property in a witness otherwise meant that the statements were not privileged.

32 The respondent did not contest that the accident report and Mr Harman’s statement were confidential documents. He submitted, however, that the statements of Ms Jackson and Luke Blenman were not; and that this was what the judge had in mind when she referred to property in a witness and in any statement made by a witness. I doubt that that was what the judge had in mind. The reasoning seems to have been no more than that there is no property in a witness, so there could not be property in any statement made by a witness, and so the statements of Ms Jackson and Luke Blenman were not privileged.

33 I will come to whether the two statements were confidential documents, but if the judge reasoned in the manner last suggested she was in error. It is sometimes said that there is no property in a witness, for example Harmony Shipping Co v Saudi Europe Line (1979) 1 WLR 1380 at 1384 per Lord Denning MR. But by that is meant that it is open to anyone to communicate with the witness, ask the witness for the witness’ account of what happened, and call the witness to give evidence. The respondent’s lawyers can speak to Ms Jackson and Luke Blenman about the accident, and the claimant has no “property” in them by which it can prevent that occurring. But client legal privilege gives protection to past communications and existing documents. If they are privileged, it gives protection to the statements of Ms Jackson and Luke Blenman, prepared on the occasion when Mr Harman obtained the statements. Ability to speak to Ms Jackson and Luke Blenman on another occasion does not preclude client legal privilege in respect of their statements.

Were the statements of Ms Jackson and Luke Blenman privileged?

34 As I have indicated, the respondent submitted, without the benefit of a notice of contention but the appellant did not object, that the statements of Ms Jackson and Luke Blenman were not confidential documents. By a notice of contention he sought to uphold the order for inspection made by the judge on the ground that the dominant purpose concerning anticipated proceedings had not been made out. He did not cross-appeal; that is, he did not seek to overturn the holding of privilege in respect of the accident report and the statement of Mr Harman.

(a) Confidential documents

35 Sections 118 and 119 broadly correspond with the categories of legal professional privilege which have come to be known as advice privilege and litigation privilege. Both sections provide for privilege (although the word “privilege” is used only in headings in the Act) with respect to confidential communications and with respect to confidential documents, and the definitions in s 117(1) are in similar terms for communications and for documents.

36 The privilege under s 118 is confined to client/lawyer dealings, by communications between client and lawyer or between lawyers or in preparation of documents by client or lawyer. The privilege under s 119 is not confined to client/lawyer dealings. The dealings may be by communications between client and lawyer or client and third party, or by unspecified preparation of documents. The control is in confidential communication or confidential document and the necessary dominant purpose.

37 Confidentiality in accordance with the definitions can readily enough be found for client/lawyer dealings. The statements of Ms Jackson and Luke Blenman, however, were obtained by a dealing between the client (the Department, through the agency of Mr Harman) and third parties (Ms Jackson and Luke Blenman). There is some controversy over the need for confidentiality in litigation privilege at common law, and the controversy is particularly material to privilege for communications between client and third party. The controversy need not be explored, since the Act bypasses it. The definitions, taken up in both s 118 and s 119 in their references to a confidential communication and a confidential document, impose the same confidentiality requirement for both the statutory equivalent to advice privilege and the statutory equivalent to litigation privilege. It imposes that requirement in the case of communications between client and third party and documents prepared by a third party for a client.

38 The appellant had to establish the privilege it claimed, see later in these reasons, including that the statements of Ms Jackson and Luke Blenman were confidential documents. For the statements to be confidential documents, it was necessary that they were prepared in such circumstances that, when they were prepared, either Ms Jackson and Luke Blenman or “the person for whom [they were] prepared” was under an express or implied obligation not to disclose their contents.

39 As I have said the statements were prepared by Ms Jackson and Luke Blenman. The person for whom the statements were prepared was either Mr Harman, who obtained the statements, or the Department (strictly the appellant as the legal entity) on whose behalf he obtained them. In my view it was the Department. It was the client in s 119, with the interest in the statements, and the statements were prepared for it as the intended recipient and potential user of the statements. They were not prepared for the person who happened to ask on its behalf that they be prepared.

40 There was no evidence of an express obligation upon Ms Jackson, Luke Blenman or the Department not to disclose the contents of the statements. Was there an implied obligation not to disclose their contents, within the meaning in the definition?

41 The definition refers to an obligation “whether or not the obligation arises under law”. In Carnell v Mann (1998) 89 FCR 247 at 258 the Full Court of the Federal Court declined to confine the obligation to the type of obligation arising in a solicitor/client relationship, as must be so when s 119 is not confined to client/lawyer dealings. (See also s 120, under which there can be a confidential communication or document where a party does not have a lawyer.) It can extend to an unspoken obligation, and to an ethical, moral or social obligation. Especially when a lawyer is not involved, the particular circumstances determine whether an obligation implicitly arises, as can be seen from decided cases. Whether a communication or document is confidential can also arise in connection with loss of client legal privilege under ss 122 or 123 of the Act, and some of the cases address it in that connection.

42 In Newcastle Wallsend Coal Co Pty Ltd v Court of Coal Mines Regulation (1997) 42 NSWLR 351, not a case under the Act, a witness statement taken by a solicitor was sent to the witness, McLean, for correction, and was returned. McLean later asked for a copy, which was sent. The draft was expressly sent on a confidential basis. The copy was in an envelope marked “private and confidential”. Powell JA, with whom Meagher JA agreed, held that this and other witness statements were initially confidential documents, but that the privilege had been lost in the case of McLean’s statement because (at 389) “the copy of that record of interview which was later provided to Mr MacLean was provided to him for his own purposes and was not made subject to any condition as to non-disclosure”.

43 This case was followed in Drabsch v Switzerland General Insurance Co Ltd [1999] NSWSC 975 as applicable to confidentiality under the Act. Hamilton J held that privilege in a witness statement had been lost, because a copy had been provided to the witness and (at [8]) -

“ ... there being no evidence but that the statement was sent to McErlane without comment and with no restriction imposed on his use of it, it seems to me that the circumstances were not such as to impose an obligation of confidentiality on him. In my opinion, it was a statement made by him, it was given to him without comment, and there was nothing in the circumstances that precluded him from giving it to anyone else as his version of the facts if he chose.”

44 In Amalgamated Television Services Ltd v Marsden [1999] NSWCA 97 a statutory declaration to which client legal privilege attached was provided to the police. The privilege was lost unless the provision to the police was a confidential communication within the definition in s 117(1). There was evidence that the solicitor providing the statutory declaration, Mr Lee, said to the police officer to whom he provided it, Superintendent Woodhouse, “I trust that like any other material I provide to you during the course of your investigation that you will keep it strictly confidential”, and that Superintendent Woodhouse said that he would. Superintendent Woodhouse had no recollection of this conversation, but said that his understanding at all times when he received material from the solicitors was “that the material was to be used exclusively for the purpose of considering it in the context of other material I had received in the course of the investigation of Strike Force Cori”. It was held that the communication was not confidential, because (at [28]) -

“ ... while the Police could not disclose the contents of the documents to all the world, it could disclose them for the purposes of the investigation in which Strike Force Cori was engaged and, if it came to that, for a prosecution of the respondent. So the contents of the document could be put to persons referred to in it, as in fact happened, and those persons would not be under any restriction in further disclosing whatever was disclosed to them; and if the contents of the document were disclosed in the course of a prosecution of the respondent, subject to any special order which might be made, the contents would pass into the public domain.”

45 In Seven Network Ltd v News Ltd [2005] FCA 864 Channel 7 provided to the ACCC a summary of legal advice it had received. The trial judge’s reasoning in relation to loss of client legal privilege included that the ACCC was not under an implied obligation not to disclose the summary, because the ACCC had publicly declared that it considered itself free to use information in its possession “for its other functions or in other contexts” (at [54]-[55]). On appeal, Seven Network Ltd v News Ltd [2005] FCAFC 125, privilege was decided on other grounds, but Allsop J said obiter at [35] -

“The primary contention of the applicants was that the production and disclosure of the document (or the adducing of evidence of the document), being secondary evidence in summary form of the advice of counsel, would result (contrary to s118 or s119 of the Act) in disclosure of the confidential communication made between the client and a lawyer (the original advice) for the dominant purpose either as found in s 118 or in s 119 of the Act. The above contention rested for its correctness upon the communication to the ACCC being a "confidential communication" as defined in s 117 of the Act. The primary judge concluded that it was not a confidential communication. In my view, his Honour was correct. There was undoubtedly a policy of the ACCC to treat information given to it by informants or under compulsory process with a degree of confidence. Mr Gray was aware of that policy. No doubt, an argument would be mounted based on public law notions of legitimate expectations and, perhaps, procedural fairness, that warning should be given before any departure from that policy. That is not to say, however, that as between these parties on 12 December 2000 it could be said that the ACCC was obliged not to disclose the contents of the communications made to if by Mr Gray and others. No doubt, the applicants hoped that their urging of the ACCC would result in steps being taken contrary to the interests, legal and commercial, of the respondents. It was hoped that the rival bid or the bidding process would be impeded or interrupted. That, it is apparent, was the idea. In those circumstances, it must have been plain that it was at the very least possible, if not likely, that should the ACCC succumb to the persuasion of the applicants it may have to justify, publicly, its course of action, and, thus, to the extent that the advice that the applicants had received from counsel, as put to the ACCC by Mr Gray, was part of those reasons, it may have to be disclosed. Mr Gray told the ACCC of counsel’s advice in order to persuade the ACCC to act upon it as a relevant consideration. In those circumstances, it can hardly be said that the ACCC was obliged not to disclose the communication made to it by Mr Gray on behalf of the applicants. Naturally, the ACCC was not free to communicate the information otherwise than for the purposes of carrying out its functions. Nevertheless, if it decided to act, one of the things that it needed to be in a position to do was justify its course of action. Mr Gray thought the advice of counsel was sufficiently important to raise, and to raise as the first matter at the meeting. As such, it can be taken as a matter, which, the parties must be taken to have appreciated, might have to be disclosed in any explanation as to why public funds were being expended at the instigation and urging of a substantial commercial organisation. This is not a matter of subjective appreciation, but one of the objective analysis of the uncontroversial facts.”

46 In Rickard Constructions Pty Ltd v Rickard Hails Moretti Pty Ltd [2006] NSWSC 234 Bergin J said at [33] that -

“ ... matters relevant in assessing whether a confidential obligation is implied in relationships or circumstances outside that of solicitor/client include the nature of the relationship in question and the circumstances, including conduct and/or conversations, surrounding the communications or documents in question. It is also permissible to have regard to the nature of the documents in question and the purpose and context of their communication: see Bulk Materials (Coal Handling) Services Pty Ltd v Coal and Allied Operations Pty Ltd (1998) 13 NSWLR 689 at 695E.”

47 Her Honour was concerned not with a witness statement, but with communications with a litigation funder. It was held that the relationship of litigant and funder and the nature of the communications, necessarily extending to the merits of the litigation, made it appropriate to imply that information provided to the funder would not be disclosed by it. In Bulk Materials (Coal Handling) Services Pty Ltd v Coal and Allied Operations Pty Ltd to which her Honour referred, not a case under the Act, it was said to be implicit in their nature and the purpose of their provision that pages from a loss assessor’s report provided by an insurer to the plaintiff were to be kept confidential by the plaintiff.

48 An obligation is ordinarily owed to another person. Here, if there were an obligation of confidentiality by the Department to Ms Jackson and Luke Blenman, or by Ms Jackson or Luke Blenman to the Department. There is no basis for an obligation of confidentiality owed by any of them to someone else.

49 The respondent submitted that there could not be confidentiality because disclosure by the Department was allowed under para 6.8 and possibly 6.7 of the policy document. The question is not so much one of permitted limited disclosure as of a non-disclosure obligation to begin with.

50 I do not think that the Department was under an obligation not to disclose the contents of the statements. The restrictions on giving copies of statements to third parties in para 6.8 of the policy document, and the reference to secure storage in the privacy note, indicate the Department’s intention to confine disclosure of statements. But there was no evidence that Ms Jackson or Luke Blenman was made aware of either. The confined disclosure was to serve the Department’s own interests. Its uncommunicated internal resolve was not an obligation, and still less an obligation owed to the makers of the statements.

51 There is nothing else in the evidence from which it could be held that the Department was unable to disclose the contents of the statements if it chose, or from which it could be held that the appellant could not disclose their contents to the respondent for the purposes of the proceedings if the appellant saw fit. Any understanding of Ms Jackson or Luke Blenman, or for that matter anyone else, that the statements were to be provided to the Department’s legal advisers and could be used if proceedings were brought by the respondent, would convey not that the statements would be kept confidential, but that the Department could use them as it saw fit including by disclosure to the respondent or to the world in open court in legal proceedings. This is the antithesis of an obligation not to disclose their contents.

52 Nor do I think that Ms Jackson or Luke Blenman was under an obligation not to disclose the contents of the statements. In J-Corp Pty Ltd v Australian Builders Labourers Federated Union of Workers (1992) 110 ALR 510 French J said, at 515, that “[t]here is nothing to stop a prospective witness who has given a statement to a solicitor from announcing that fact and the content of his statement to the world at large”. As a general statement that may go too far, but it points up the need to find in the circumstances an obligation not to do so. There is no evidence that at the time Ms Jackson and Luke Blenman were asked, and agreed, not to disclose the contents of their statements. The statements were not on the form from the policy document (although I express no view on whether that would have sufficed for an obligation of confidentiality). Assuming they had the understanding mentioned in the preceding paragraph, I do not think it can be found that the Department had an expectation that they would not do so. So far as the evidence goes, they were neutral observers who told the Department what they observed and were free to tell anyone else both what they had observed and what they had told the Department; and pursuant to para 6.8 of the policy document they could be given copies of their statements if requested, and para 6.8 made no reference to attaching a non-disclosure string.

53 In relation to common law legal professional privilege McLelland J said in Ritz Hotel Ltd v Charles of the Ritz Ltd (No 22) (1988) 14 NSWLR 132 at 133-4 -

“Now, whether in the case of communications between a party or its representative on the one hand and a potential witness on the other, those communications can be said to be confidential so far as the potential witness is concerned, may be a nice question in many circumstances. In the case of an independent witness to some event who is interviewed by a party or his solicitor or representative with a view to his making an affidavit or giving evidence in anticipated or pending proceedings, the details of that interview would not in my view be confidential so far as the potential witness is concerned in the absence of special circumstances, because the potential witness in that situation is not a person owing any duty of confidentiality to the party or to the party's solicitor or representative. And in a situation of that kind, the question whether a claim for protection from disclosure of the communications on the basis of legal professional privilege should be upheld would in my opinion depend on whether the disclosure sought is, on the one hand, from the party or his solicitor or representative, in which case the claim should succeed, or, on the other hand, from the independent witness, in which case the claim should fail.”

54 This is consistent with what I have said so far, as his Honour did not think the witness statement confidential “so far as the potential witness is concerned”. His Honour would nonetheless have found privilege if disclosure was sought from the party or the party’s lawyer.

55 Differential confidentiality does not matter for the definitions in the Act, since it is enough that one of the parties to the communication or the preparation of the document is under an obligation not to disclose its contents. His Honour appears to have thought that there would be privilege if disclosure was sought from the party or the party’s lawyer because so far as the party or the lawyer was concerned the statement was confidential. The confidentiality appears to have been founded on the interest of the party in keeping the statement confidential, ultimately on legal professional privilege itself. Confidentiality for common law legal professional privilege has also been found in that manner in, for example, Australian Competition and Consumer Commission v Australian Safeway Stores Pty Ltd (1998) 81 FCR 526, where Goldberg J said at 563 that it was “hardly to be expected that at that stage the Commission would be prepared for any person to see the statements”.

56 Reasoning from the party’s interest in keeping confidential the communication or document it received is in accord with the present rationale for litigation privilege stated by McHugh J in Mann v Carnell. That was a case of client/lawyer communications, and his Honour dissented in the result, but the explanation holds good -

“[114] The rationale for the head of legal professional privilege which protects communication from a third party to the client or the lawyer made in connection with the litigation is related to, but distinct from, that discussed in Grant. The rationale for the second head of legal professional privilege arises from the need to maintain, in an adversary system of litigation, the freedom of the lawyer and client to make such investigations and inquiries and to engage in such preparation as they think fit in order to further their case. A party to litigation should not be forced to prepare his or her case knowing that statements, advices and other documents, which have been created, may be required to be disclosed to the other party who can then make use of the documents for his or her own advantage. As Brennan J said in Baker v Campbell, the relevant purpose of the privilege is the ‘maintenance of the curial procedure for the determination of justiciable controversies - the procedure of adversary litigation’. His Honour went on to say that ‘[i]f the prosecution, authorized to search for privileged documents, were able to open up the accused's brief while its own stayed tightly tied, a fair trial could hardly be obtained’.”

57 So it was said of litigation privilege in General Accident Assurance Company v Chrusz (1999) 180 DLR (4th) 241 at [24] that -

“It is not rooted, as is solicitor-client privilege, in the necessity of confidentiality in a relationship. It is a practicable means of assuring counsel what Sharpe calls a ‘zone of privacy’ and what is termed in the United States, protection of the solicitor’s work product: See Hickman v Taylor, [1947] USSC 5; 329 US 495 (1946).”

58 But I do not think that this reasoning is available in order to find a confidential communication or a confidential document within the meaning of the definitions in s 117(1) of the Act. The rationale involves confidentiality, but it is confidentiality afforded by the privilege itself. The party’s interest in keeping confidential the communication or document it received is not confidentiality because of an express or implied obligation on the party not to disclose the communication or document. It is confidentiality because of protection from compulsory disclosure by the party. The party can disclose the communication if it wishes; that will waive any privilege, but it is not prevented by any obligation of confidentiality.

59 In Fagan v State of New South Wales [2004] NSWCA 182 it was said at [70] that the principle that there was no property in a witness had to operate in conjunction with other principles, including that of legal professional privilege. In that case a prospective witness’ freedom to disclose the contents of a witness statement was regarded as restricted by the latter principle. It was held that where a statement taken by a lawyer was privileged, and remained privileged when given to the prospective witness, a direction by the witness’ superior requiring disclosure of its contents would involve a breach of legal professional privilege: at [76]-[77].

60 I do not think that this means that Ms Jackson and Luke Blenman were under an obligation not to disclose the contents of their statements because, in maintenance of its freedom to prepare for litigation without fear of disclosure to the other party, the Department could prevent disclosure. There would be circularity in the reasoning, an assumption of client legal privilege in order to establish client legal privilege. In Fagan v State of New South Wales there was no circularity. It was emphasised at [74] that the State accepted that the prospective witness’ statements were and remained privileged. In the present case the non-disclosure obligation is necessary in order that there be privilege in the first place. Fagan v State of New South Wales was not decided with reference to the terms of the Act, and entitlement to litigation privilege can not be used to find the obligation not to disclose the contents of the document.

61 For these reasons, in my opinion the statements of Ms Jackson and Luke Blenman were not confidential documents within the definition in s 117(1) of the Act.

(b) Anticipated proceedings

62 If what I have said about confidential documents be correct, this does not affect the result. I should nonetheless deal with it.

63 The respondent submitted first, that the purpose in s 119 required a degree of likelihood of litigation greater than the across the board response to every non-trivial accident seen in the policy document; and secondly, that it should be inferred that the documents were brought into existence for another or other at least equal purposes, so that the dominant purpose requirement was not satisfied.

64 It was common ground that it was for the appellant to establish client legal privilege. That is so for common law legal professional privilege (Grant v Downs at 689 per Stephen, Murphy and Mason JJ; Mitsubishi Electric Australia Pty Ltd v Victorian WorkCover Authority [2002] VSCA 59; (2002) 4 VR 332 at [11]; Federal Commissioner of Taxation v Pratt Holdings Pty Ltd [2005] FCA 1247; (2005) 60 ATR 466 at [390]), and in principle must be so for client legal privilege under the Act. The purpose is to be determined objectively (Grant v Downs at 682; Nickmar Pty Ltd v Preservatrice Skandia Insurance Ltd (1985) 3 NSWLR 44 at 55; Australian Competition and Consumer Commission v Australian Safeway Stores at 558), but subjective purpose “will always be relevant and often decisive” (Esso Australia Resources Ltd v Commissioner of Taxation at [172] per Callinan J).

65 Whose purpose is it? The statements were obtained by Mr Harman, but he was acting as a teacher in the Department’s school and following Departmental practice. The purpose is that of the Department, a corporate purpose to be found (on the evidence in this case) in Mr Harman’s explanation of the reasons for obtaining the documents and giving them to the School Executive, and in the policy document.

66 Grant v Downs was concerned with departmental reports relating to the death of a psychiatric patient. The majority adopted a “sole purpose” rather than a “dominant purpose” test. That has since been overturned in Esso Australia Resources Ltd v Commissioner of Taxation, and s 119 prescribes a dominant purpose requirement. In Grant v Downs Barwick CJ said at 678 that it is preferable to “test the status of each document according to the purpose of its production and not to erect categories of documents so as to facilitate some mechanical, almost computerised resolution of the question of the right to withhold a document from inspection”. His Honour, who favoured the “dominant purpose” test, nonetheless expressed the general principle 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.”

67 In Warner v Women’s Hospital (1954) VLR 410 the phrase used was “reasonably apprehended”. In Mitsubishi Electric Australia Pty Ltd v Victorian WorkCover Authority there was comprehensive consideration of the cases, and it was said at [19] that as a general rule “there must be a real prospect of litigation, as distinct from a mere possibility, but it does not have to be more likely than not”. In the lastmentioned case the Court declined to accept the formulation in Australian Competition and Consumer Commission v Australian Safeway Stores at 559 of reasonable probability or likelihood that proceedings would be commenced. I respectfully consider that the general rule stated in Mitsubishi Electric Australia Pty Ltd v Victorian WorkCover Authority in relation to legal professional privilege should guide anticipation of proceedings in s 119 of the Act.

68 In Grant v Downs in the joint judgment of Stephen, Mason and Murphy JJ, who favoured the “sole purpose” test, their Honours said at 682 -

“It has been accepted that documents brought into existence after an accident pursuant to a standing instruction previously given may be privileged (Collins v London General Omnibus Co (1893) 68 LT 831The Hopper No 13 [1925] P 52; Ankin v London and North Eastern Railway Co [1930] 1 KB 527 at 536 ; [1929] All ER Rep 65; Ogden v London Electric Railway Co (1933) 49 TLR 542 ; [1933] All ER Rep 896). Although to sustain the privilege it is not necessary that the document has been brought into existence on the advice of the solicitor, it is essential that the circumstances are such that the court can subsequently conclude, viewing them objectively, that litigation can be reasonably anticipated — see Feuerheerd v London General Omnibus Co Ltd [1918] 2 KB 565; Cataldi v Commissioner for Government Transport [1969] 1 NSWR 561; [1970] 1 NSWR 65 at 68 — and this at the time when the preparation of the document is undertaken.”

69 The appellant submitted that s 119 had altered the position as to time expressed in this passage, and that there did not have to be anticipation at the time the statements were obtained. The argument was, with respect, rather elusive. The appellant drew attention to “or might have been” in s 119, and on my best understanding of the argument said that this gave an alternative of determining at the time client legal privilege was in question that proceedings had “been and gone” without the client being a party; so actuality rather than anticipation could govern, and the actuality of proceedings in the present case in the conduct of which the statements were used supplied the purpose. I do not agree. The purpose for which a document was prepared must be as determined at the time of its preparation, and the words “or might have been” are for anticipated proceedings which did not in fact come about.

70 In Cataldi v Commissioner for Government Transport (1970) 1 NSWLR 65 the relevant documents were statements of the driver of a bus involved in an accident and a fellow employee, made pursuant to a standing instruction to employees.

71 The Court cited at 67-8, from Tooheys Ltd v Housing Commission of New South Wales (1952) 20 LGR 236 at 245-6, a passage which included that in some cases proceedings had been regarded as anticipated although no claim had yet been made and that “[i]n common experience, happenings of some kinds very often lead to litigation, and the occurrence of such an event would found a sufficient anticipation of litigation”. Their Honours continued at 68 -

“Considered in the light of these observations which reflect correctly the effect of the decided cases, the question must be answered by stating that the two statements are privileged. The circumstances in which the documents came into being are such as to compel the inference that it was a purpose of their coming into existence that they would serve as materials upon which professional advice would be sought or that they would be used for the conduct of litigation arising out of the accident.

The respondent conducts a transport undertaking which is a public utility. In the community of today actions for damages for personal injury are a normal incident in the carrying on of such an activity and a normal sequel of an accident such as occurred in the present case. In the ordinary course of conducting a transport undertaking of this kind it is to be anticipated that the authority would wish to obtain information in the form of statements by witnesses of accidents with a view to their use as materials for legal advice and for the conduct of litigation arising out of accidents. This anticipation is reinforced by the character of the Working Orders and Instructions to which we have already referred. The contents of the reports as required by the instructions are so comprehensive in relation to the cause of the accident and in relation to the issue of legal liability that it is unreal to suggest that legal advice and the conduct of litigation in connection with the accident are not one of the purposes for which they are brought into existence.

It is not to the point, as was urged by counsel for the appellant, that the documents were called into existence by the respondent, and not by the solicitor for the respondent. It is well established that the privilege attaches notwithstanding that the party intends, if he can, to settle the matter without resort to a solicitor at all.”

72 In my opinion, the evidence overwhelmingly calls for the conclusion that the statements of Ms Jackson and Luke Blenman were obtained for the purpose of legal advice as to and the conduct of anticipated proceedings against the Department arising from the accident, the conduct of proceedings including settlement prior to the actual institution of proceedings.

73 Mr Harman’s affidavit shows that at the time he had in his mind that there could be legal action, and while he did not express subjective anticipation of proceedings he gave no evidence to the contrary. Despite the paucity of evidence, from the serious injuries alleged by the respondent it can be inferred that the accident would have been seen by some persona representing the Department as potentially serious at the time. The policy document itself indicates that claims by injured students are, in words adapted from Cataldi v Commissioner for Government Transport, a normal incident of carrying on the Department’s activities, which judicial experience does not deny. The general anticipation of proceedings had substance in the present case. A serious accident would in my view warrant anticipation of proceedings at the time.

74 Was the purpose I have stated the dominant purpose? In Sydney Airports Corporation Ltd v Singapore Airlines Ltd [2005] NSWCA 47 Spigelman CJ, with whom Sheller JA and M W Campbell AJA agreed, said at [7] -

“The test of ‘dominant purpose’ has been expressed in terms of ‘clear paramountcy’ (see Waugh v British Railways Board [1979] UKHL 2; [1980] AC 521, at 543; Mitsubishi Electric Australia Pty Ltd v Victorian WorkCover Authority [2002] VSCA 59; (2002) 4 VR 332, at 336–337[10]). As the High Court said in a different context:

‘In its ordinary meaning, dominant indicates the purpose which was the ruling, prevailing, or most influential purpose.’

Federal Commissioner of Taxation v Spotless Services Ltd [1996] HCA 34; (1996) 186 CLR 404, at 416 (Brennan CJ, Dawson, Toohey, Gaudron, Gummow and Kirby JJ).”

75 Determining dominance calls for appreciation of competing purposes. They should be found in evidence rather than speculation. The respondent submitted that a purpose was informing parents and caregivers in accordance with para 6.7 of the policy document. It seems to me, however, that informing is likely to have occurred prior to or at least independently of completion of an Accident to School Student form and obtaining statements, and that any use of information in such documents to inform parents would be incidental; provision of copies of the statements would not be possible consistently with para 6.8. He submitted, taking up the basis for the concern expressed by the judge, that the documents were to be used in remedying school practices. That is speculation; Mr Harman could have been asked about it, but was not, and for all that appears in the evidence a separate policy document and documentary trail existed and was implemented to that end.

76 In my opinion, the purpose I have stated was the dominant purpose in the preparation of the statements of Ms Jackson and Luke Blenman.

The result

77 Notwithstanding the dominant purpose, since they were not confidential documents the statements of Ms Jackson and Luke Blenman were not privileged. I propose that the appeal be dismissed with costs.

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LAST UPDATED: 10 October 2007