Citation: Orr v Hunter Quarries Pty Ltd (No. 3) [2018] NSWDC 537
Court: District Court of New South Wales
Date: 4 May 2018
Judge(s): Russell SC DCJ
Background
The defendant faced prosecution for an alleged breach of its duty under s 19(1) of the Work Health and Safety Act 2011. The prosecutor engaged an expert, Mr Samuels of QMW Industries Pty Limited, who produced two expert reports that were served on the defendant.
The defendant issued a subpoena to QMW requiring production of documents, including draft expert reports and correspondence between the prosecutor's solicitors and the expert. QMW produced the documents but the prosecutor claimed legal professional privilege (or, in the alternative, client legal privilege under the Evidence Act) over a subset of them.
The central dispute was whether privilege attached to draft reports and communications passing between the prosecutor's solicitors and the expert, and whether serving the final expert reports had waived any such privilege.
Legal Issues
- Whether common law privilege principles or the Evidence Act 1995 (NSW) governed the privilege claim
- Whether s 131A of the Evidence Act applied where the subpoenaed third party (QMW) was not the party claiming privilege
- Whether the court should examine the disputed documents itself to assess the privilege claim, or decide the question on affidavit evidence alone
- Whether privilege attached to individual draft reports and emails, having regard to whether they were communicated to the lawyers and whether they influenced the expert's substantive opinions
- Whether serving the final expert reports amounted to a waiver of privilege over related draft reports and correspondence
Decision
Issue 1: Common law or Evidence Act?
The court held that common law principles govern the privilege claim, not the Evidence Act (at [27]). The Uniform Civil Procedure Rules 2005 did not apply to this criminal proceeding, and it was those Rules that had brought the Evidence Act into play in the civil cases cited to the court (at [20], [27]). The court also found that s 131A of the Evidence Act had no application because that section addresses a disclosure requirement directed at the party claiming privilege, and here the subpoena was directed at QMW, not the prosecutor (at [27]). At common law, privilege protects confidential communications made for the dominant purpose of obtaining or giving legal advice or assistance, or of use in connection with legal proceedings (at [28]).
Issue 2: Should the court inspect the documents?
The court declined to read the folder of disputed documents (at [35]). Drawing on the approach in Hancock v Rinehart and Tavcol, the court considered that privilege claims of this kind should be resolved on the basis of admissible evidence about the documents, not by the court's own inspection of them. The prosecutor's solicitor, Ms Reid, filed two affidavits providing direct evidence about the nature and purpose of each disputed document, and the court proceeded on that basis (at [32]-[35]).
Issue 3: Privilege and waiver in relation to individual documents
The court upheld privilege over draft reports and associated emails that had been communicated between the expert and the prosecutor's solicitors for the purpose of ensuring the reports were in admissible form, where those communications did not influence the substantive opinions expressed by the expert (at [40], [42], [45]-[47], [50]). Serving the final expert reports did not waive privilege over those communications.
The court found that draft reports generated unilaterally by the expert and not communicated to the lawyers fell within Southcorp Principle 3 and were not privileged, ordering their production to the defendant (at [51], [54], [57], [64]). The court also held that a copy of a communicated draft retained by the expert (whether electronically or in hard copy) shares the privilege of the original: if the communicated document is privileged, so is the copy retained by its author (at [62]-[63]).
Orders Made
- Documents described or referred to in paragraphs 73, 78, 88, 98 and 105 of Exhibit PX 15 are not privileged and may be inspected by the defendant.
- The folder of documents marked MFI 12 is to be returned to the solicitors for the prosecutor.
- Costs reserved.
Key Takeaways
- The District Court confirmed that, in criminal proceedings to which the Uniform Civil Procedure Rules do not apply, common law principles rather than the Evidence Act 1995 govern claims for legal professional privilege over documents produced on subpoena by a third party (at [27]).
- Section 131A of the Evidence Act does not apply where the party claiming privilege is not the same party to whom the disclosure requirement (such as a subpoena) was directed (at [27]).
- Draft expert reports and covering communications that pass between lawyers and an expert solely to address admissibility and form, without influencing the expert's substantive opinions, can attract privilege and are not waived by service of the final report (at [40], [45]-[47]).
- Applying Southcorp Principle 3, draft reports generated unilaterally by an expert and never communicated to the retaining lawyers are not privileged, regardless of whether the final report was served (at [51], [54]).
- A copy of a privileged communicated document retained by the expert shares the privilege of the original: privilege does not fall away merely because the copy sits on the expert's hard drive rather than in the lawyer's file (at [62]-[63]).
Legislation and Cases Referenced
Legislation
- Corporations Act 2001 (Cth)
- Evidence Act 1995 (NSW)
- Uniform Civil Procedure Rules 2005 (NSW)
- Work Health and Safety Act 2011 (NSW)
Cases
- ASIC v Southcorp Limited [2003] FCA 804
- Derbas v The Queen [2012] NSWCCA 14
- Esso Australia Resources Limited v Commissioner of Taxation [1999] HCA 67; 201 CLR 49
- Hancock v Rinehart (Privilege) [2016] NSWSC 12
- Mann v Carnell [1999] HCA 66; 201 CLR 1 at [28-29]
- New South Wales v Public Transport Ticketing Corporation [2011] NSWCA 60
- Newcap Reinsurance Corporation Ltd (In Liquidation) v Renaissance Reinsurance Limited [2007] NSWSC 258
- Tavcol Pty Limited v Valbeet Pty Limited [2016] NSWSC 1002
- Traderight (NSW) Pty Limited v Bank of Queensland Limited (No. 14) [2013] NSWSC 211