National Crime Authority v S

Re: NATIONAL CRIME AUTHORITY And: S No. V G54 of 1991 FED No. 234 Evidence 100 ALR 151 29 FCR 203 (1991) 54 A CRIM R 307 COURT

IN THE FEDERAL COURT OF AUSTRALIA

VICTORIA DISTRICT REGISTRY

GENERAL DIVISION

Keely(1), Lockhart(2) and Heerey(3) JJ. CATCHWORDS

Evidence - application for an order of review in respect of claim of legal professional privilege - ss.30 and 32 National Crime Authority Act 1984 - whether entitlement to privilege exists where "theoretical possibility" of disclosure of substance of communications - whether onus on person claiming privilege to establish facts giving rise to it - procedure to be adopted by Authority - whether privilege extends only to communications or to collateral facts observed by practitioner - statutory context of ss.30 and 32 examined.

National Crime Authority Act 1984 ss.30 and 32

Baker v Campbell (1983) 153 CLR 52

Grant v Downs (1976) 135 CLR 674

Sorby v The Commonwealth (1983) 152 CLR 281

Young v Quin (1984) 59 ALR 225

National Employers Mutual General Insurance Association Ltd v Waind (1979) 141 CLR 648

Gardner v Irvin (1878) 4 Exch 49

Greenough v Gaskell (1833) 1 My and K 98, 39 ER 618

Wheatley v Williams (1836) 1 M and W 533, 150 ER 546

Brown v Foster (1857) 1 H and N 736, 156 ER 1397

Kennedy v Lyell (1883) 23 ChD 387

Ex parte Campbell: in re Cathcart (1870) 5 Ch App 703

Packer v Deputy Commissioner of Taxation (1988) 1 Qd R 275 HEARING MELBOURNE #DATE 1:5:1991

Counsel for the Appellant: Mr M. Rozenes QC with

Mr B.E. Walters

Solicitors for the Appellant: Australian Government Solicitor

Counsel for the Respondent: Mr A.C. Archibald QC with

Ms H.M. Symon

Solicitors for the Respondent: Corrs Chambers Westgarth

ORDER

1. The appeal be allowed.

2. The orders of Jenkinson J. made on 15 February 1991 be set aside and in lieu thereof it be ordered that the respondent's application for an order of review of the appellant's decisions of 11 January 1991 be dismissed.

3. Each decision of the appellant in respect of which an applicatio n for review was made be affirmed.

4. The appellant's costs to be taxed of the appeal and of the proceeding at first instance be paid by the respondent.

5. Subject to paragraph 6 hereof, the documents placed in the custo dy of the Registrar pursuant to s.32(3) of the National Crime Authority Act 1984 be delivered to the respondent after the expiration of 14 days from the date of this order.

6. Reserve liberty to either party to make application in writing within 14 days from the date of this order for orders regarding the delivery of the documents referred to in paragraph 5 hereof. JUDGE1

In considering this appeal I have had the advantage of reading the reasons for judgment prepared by Lockhart J. I agree with his conclusion that the appeal should be allowed, that each of the orders of the learned primary judge should be set aside and that the respondent S should pay the costs of the appellant in respect of both the appeal and the proceeding at first instance. I also agree with his Honour's proposed orders in respect of the documents placed in the custody of the District Registrar of the Court.

I agree generally with the reasons given by Lockhart J. for making the orders proposed by him. JUDGE2

The case concerns questions of legal professional privilege in hearings before the National Crime Authority ("the Authority") under the National Crime Authority Act 1984 ("the Act").

The Authority is conducting an investigation into whether criminal offences have been committed. A summons was issued pursuant to s. 28(1) of the Act signed by a member of the Authority directed to a solicitor. The solicitor, pursuant to an order of the Court (made because of the nature of the hearing before the Authority and the requirement of the Act that it be held in camera), is identified as "S", the respondent. The summons required "S" to appear before the Authority on a date specified in it, for the purpose of the investigation, to give evidence and to produce documents described in the Schedule to the summons in these terms (but making a substitution of names and dates):

"All original and copy diary notes, file notes, letters, drafts of letters, correspondence and any other document whatsoever concerning the drafting, settling and transmission of a letter dated 30 February 1981 to Ms A, National Companies and Securities Commission from Buzz Ltd, Mr B."

The summons stated that:

"The Authority intends to question you regarding matters concerning the drafting and settling of a letter to Ms A, National Companies and Securities Commission signed by Mr B, Buzz Ltd. dated 30 February 1981."

S appeared before the Authority in answer to the summons. The Authority was constituted at the hearing by one of its members. S was represented by counsel. Counsel assisting the Authority conducted the examination of S. S was asked questions by counsel assisting the Authority and he claimed that he did not have to answer certain of the questions put to him, or produce certain of the documents of which production was required by the summons, on the ground of legal professional privilege.

A perusal of the transcript of proceedings before the Authority reveals that there were various refusals by S to answer questions or to produce documents, namely: . a refusal to identify a file of which there is, what S called, a "subfile", kept by the firm of solicitors of which he is a member, and the name or number of the file; . a refusal to identify persons within Buzz Ltd ("Buzz") who communicated with him; . a refusal to identify officers of Buzz to whom he spoke in relation to the request by the National Companies and Securities Commission ("NCSC") for information, such information being contained in the letter dated 30 February 1981 to the NCSC from Buzz; . a refusal to identify the person at Buzz whom he asked to produce certain documents and to identify the documents themselves; . a refusal to identify persons present at meetings with him, also the number of persons present and the dates of the meetings; . a refusal to state when advice was given to his client by him except that it was at some stage in a particular month of a year, but the precise date would not be given by him and nor would he say whether the advice was in writing.

The basis on which these refusals was based, as contended by counsel appearing for S before the Authority, was that sub-section

On 11 January 1991 the Authority decided that S was not entitled to refuse to answer those questions put to him at the hearing and that he was not entitled to refuse to produce the documents included in those referred to in the Schedule to the summons. The applicant then sought a review of the decisions pursuant to s. 32(2) of the Act which, in essence, so far as presently relevant, enables a person to apply to this Court for an order of review in respect of a decision by the Authority that in the Authority's opinion the claim of a person to be entitled to refuse to answer a question put to him, or to produce a document he was required to produce at a hearing before the Authority, is not justified (see also s. 32(1)(c)).

The review was conducted before Jenkinson J. His Honour rejected the contention that it was sufficient to sustain a claim for legal professional privilege if the answer to the question would disclose the fact of the privileged communication rather than the contents of it. His Honour then found that there was a "theoretical possibility" that the answers would disclose the subject matter of advice given to the client and said that, because there existed a "theoretical possibility" that the answers of S would disclose the subject matter of the advice and because he was accepted as an honest witness by the Authority, it was incumbent upon the Authority, if it wished to take the matter further, to interrogate S as to the circumstances surrounding the claim for privilege. Also, in the case of documents, it was incumbent upon the Authority to require S to give in respect of each document an account which would disclose the ground on which he claimed that it was privileged.

His Honour in substance held that an onus lay upon the Authority to establish these matters, that it had not discharged the onus and therefore its decisions under review should be set aside. The Authority appealed to the Full Court of this Court from his Honour's judgment.

On appeal to this Full Court, it was argued by counsel for the Authority that the learned primary Judge, having correctly found that sub-section (3) of s.30 of the Act did not involve an extension of privilege to the fact of the communication between a legal adviser and his client in addition to the content thereof, erred in finding that there was a "theoretical possibility" that the answers of S to the questions of counsel for the Authority would disclose the subject matter of the advice which he had given to his client. He submitted that his Honour should have held that it was for S, as the person asserting legal professional privilege, to establish the facts giving rise to it and that his Honour erred in finding that it was for the Authority in all the circumstances to negate on the facts of the case the existence of the "theoretical possibility" that the answers of S would disclose the subject matter of the advice.

Although this case is concerned primarily with ss. 30 and 32 of Division 2 of Part II of the Act it is important to understand the operation of those sections in the statutory context in which they appear.

The Authority is established by s. 7 of the Act and its "general functions" are defined by s. 11(1) as, inter alia, collecting and analysing criminal information and intelligence relating to relevant criminal activities and disseminating that information and intelligence to law enforcement agencies and certain other persons (paragraph (a)); and investigating matters relating to relevant criminal activities (paragraph (b)).

Division 2 (ss. 25 to 36) of Part II of the Act relates to hearings before the Authority. Reference should be made to some of the relevant sections. The Authority is empowered to hold "hearings" for the purposes of a "special investigation" (s. 25(1)) - a "special investigation" being defined in the definition section (s. 4) as meaning "an investigation that the Authority is conducting in the performance of its special functions". The "special functions" of the Authority are contained in s. 11(2) of the Act. At a hearing the Authority may be constituted by one or more members (s. 25(2)). The Authority is empowered to regulate the conduct of proceedings at a hearing as it thinks fit (s. 25(3D)). A person giving evidence at a hearing before the Authority is entitled to be represented by a legal practitioner (s. 25(4)(a)). A hearing before the Authority shall be held in private and the Authority may give directions to the persons who may be present during the hearing or a part of the hearing (s. 25(5)); but no such direction can exclude a person representing the person giving evidence and certain other persons (s. 25(6)). The right of examination or cross-examination of any witness on any matter that the Authority considers relevant to the special investigation is conferred upon counsel assisting the Authority and legal practitioners representing persons at the hearing (s. 25(8)). The Authority is empowered to give directions that evidence before it or contents of documents produced to it or certain other information and material shall not be published (s. 25(9)).

Sections 28 and 30 are the critical sections for present purposes because S was required to attend before the Authority by summons issued pursuant to s. 28. A member of the Authority may summon a person to appear before the Authority at a hearing to give evidence and to produce documents (s. 28(1)). The member presiding at a hearing before the Authority may require a person appearing at the hearing to produce a document or other thing (s. 28(4)). The Authority is empowered at a hearing to take evidence on oath or affirmation (s. 28(5)).

Section 29 should be mentioned here because, although not itself directly relevant to the case, it assists in comprehending the statutory scheme. It empowers a member of the Authority, by notice in writing served on a person, to require the person to attend before a person specified in the notice, being a member of the Authority or of its staff, and to produce documents or things specified in the notice relevant to a special investigation. It is an offence for a person without reasonable excuse to refuse or fail to comply with a notice served on him under this section (s. 29(3)).

Sub-section

Section 28 thus empowers the Authority to summon witnesses before it for the purpose of giving evidence and producing documents, whereas s. 29 empowers a member of the Authority to serve written notice upon persons, not to give evidence, but to produce documents or things relevant to a "special investigation". As S was summoned to give evidence and produce documents, s. 28 (not s. 29) is the relevant section.

A person served with a summons pursuant to s. 28 shall not "without reasonable excuse" fail to attend as required by the summons (s. 30(1)). Sub-sections (2) and (3) of s. 30 read as follows:

"

Sub-section

Section 32(1) requires the Authority, where a person claims to be entitled to refuse to furnish information or produce documents to it pursuant to a section 20 notice (not relevant in this case), or claims to be entitled to refuse to produce a document pursuant to a section 29 notice, or claims to be entitled to refuse to answer questions or produce documents at a hearing before the Authority (i.e. a section 28 hearing), to decide as soon as practicable whether in its opinion the claim is justified and notify the person of its decision. The person, if dissatisfied, may apply to this Court (as S did in this case) for an order of review in respect of the decision (s. 32(2)).

Although it was argued before the Authority by counsel for S that sub-section (3) of s. 30 involved an extension of the doctrine of legal professional privilege to the fact of a communication and not merely the content of it, the argument was expressly disavowed before us. Counsel accepted before us that the sub-section simply recognised and adopted the common law with respect to legal professional privilege where the witness or person producing the document is a legal practitioner.

The only express reference to the availability of legal professional privilege as a ground for declining to answer questions or produce documents is that found in sub-section

Legal professional privilege protects the disclosure of communications between client and legal adviser which are confidential and are made or brought into existence for the sole purpose of enabling the client to obtain, or the legal adviser to give, legal advice or for use in legal proceedings existing or anticipated. See Grant v Downs (1976) 135 CLR 674 where Stephen, Mason and Murphy JJ. said at 688:

"All that we have said so far indicates that unless the law confines legal professional privilege to those documents which are brought into existence for the sole purpose of submission to legal advisers for advice or for use in legal proceedings the privilege will travel beyond the underlying rationale to which it is intended to give expression and will confer an advantage and immunity on a corporation which is not enjoyed by the ordinary individual. It is not right that the privilege can attach to documents which, quite apart from the purpose of submission to a solicitor, would have been brought into existence for other purposes in any event, and then without attracting any attendant privilege. It is true that the requirement that documents be brought into existence in anticipation of litigation diminishes to some extent the risk that documents brought into existence for non-privileged purposes will attract the privilege but it certainly does not eliminate that risk. For this and the reasons which we have expressed earlier we consider that the sole purpose test should now be adopted as the criterion of legal professional privilege."

Deane J. said in Baker v Campbell (1983) 153 CLR 52 at 112:

"This privilege, ordinarily described as legal professional privilege, protects a person from disclosure of oral or written confidential communications, between himself and his solicitor or barrister, made or brought into existence for the sole purpose of seeking or giving advice or for the sole purpose of use in existing or anticipated litigation (see Grant v Downs (supra); O'Reilly v State Bank of Victoria Commissioners ((1953) 153 CLR 1 at pp 22-23) and, as to the absence of any requirement that advice be in the course of or anticipation of litigation, Forster v Hall ((1831) 12 Pick 39 at p 98); Greenough v Gaskell ((1833) 1 My and K 98 at 103, 39 ER 618 at 621); per Brett M.R. in Pearce v Foster ((1885) 15 QB 114 at 121). It is the privilege of the client and protects him from being compelled to make disclosure of such communications either in testimony or by the production of documents for inspection. It also protects him from such disclosure, in the absence of his consent, by his legal adviser. The privilege does not extend to protect communications which are in themselves part of a criminal or fraudulent proceeding or course of conduct or which constitute the whole or part of an actual dealing or transaction (see O'Reilly's Case (supra, at p 26)). Nor does it extend to protect things lodged with a legal adviser for the purpose of obtaining immunity from production. The privilege may be lost by waiver and, arguably, by the content of the communication ceasing to be confidential (Lloyd v Mostyn ((1842) 10 M and W 478, 152 ER 558); Calcraft v Guest ((1898) 1 QB 759); but cf. Ashburton (Lord) v Pape ((1913) 2 Ch 469)."

Dawson J. said at 122-3:

"Legal professional privilege attaches only to communications made for the purpose of giving or receiving advice or for use in existing or anticipated litigation. Moreover, if the communication in question is in the form of a document submitted by a client to his solicitor for use in existing or anticipated litigation, privilege will attach to it only if it comes into existence solely for that purpose. The privilege cannot operate to put beyond the reach of the law documentary or other material which has an existence apart from the process of giving or receiving advice or the conduct of litigation. See Grant v Downs (supra). There is no privilege for physical objects other than documents and there is no privilege for documents which are the means of carrying out, or are evidence of, transactions which are not themselves the giving or receiving of advice or part of the conduct of actual or anticipated litigation. Communications which would otherwise be privileged lose their immunity from disclosure if they amount to participation in a crime or a fraud. The compass within which the doctrine of legal professional privilege operates is, therefore, narrow having regard to the principle which it protects."

We were referred by counsel for the respondent to a number of English decisions on the content and scope of the rule relating to legal professional privilege. In my opinion it is not necessary to analyse these cases because as I perceive the issues on the appeal there is no need to go beyond the Australian cases, in particular Grant v Downs and Baker v Campbell, where the earlier cases, including English cases, are reviewed.

The essential question in issue on this appeal is whether the primary Judge was correct in holding that, because there existed a "theoretical possibility" that the answers of S to the questions put to him by counsel for the Authority would disclose the subject matter of the advice and because he was accepted as an honest witness by the Authority, it was incumbent upon the Authority, if it wished to proceed further, to interrogate S as to the circumstances surrounding the claim for privilege, and, in the case of documents, to require him to give in respect of each document an account which would disclose the ground on which he claimed that it was privileged.

It is for the party asserting or claiming legal professional privilege to establish the facts giving rise to it: see Grant v Downs per Stephen, Mason and Murphy JJ. at 689. It was for S to do more than merely assert a claim for privilege which in substance is all that he did. He exposed no facts from which the Authority would have been able to make an informed decision as to whether the claim for privilege was supportable.

Affidavits of documents in the discovery process not infrequently claim legal professional privilege by asserting that the purpose for which a document was brought into being was its sole purpose, followed by a statement as to which particular category of legal professional privilege the document belongs; for example, for use in existing or anticipated litigation. Although an affidavit in this form is usually sufficient and uncontroversial the potential for abuse is obvious. Courts should not be slow to permit cross examination of the deponent of such an affidavit: see Grant v Downs; Young v Quin (1984) 59 ALR 225 (a case on public interest immunity); National Employers Mutual General Insurance Association Limited v Waind (1979) 141 CLR 648 and Cross on Evidence, 4th Australian ed. 1991, para. 25240.

As Stephen, Mason and Murphy JJ. said in Grant v Downs at 689:

"He may succeed in achieving this objective (successfully claiming legal professional privilege) 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. The court has power to examine the documents for itself, a power which has perhaps been exercised too sparingly in the past, springing possibly from a misplaced reluctance to go behind the formal claim of privilege. It should not be forgotten that in many instances the character of the documents the subject of the claim will illuminate the purpose for which they were brought into existence."

When questions of legal professional privilege arise in proceedings before courts there are well established procedures for dealing with them. The claim is asserted on oath and it is open to the court or the person who seeks access to the document or the answer to the question to cross examine the person who makes the claim. The extent to which the court allows cross-examination or itself asks questions of the deponent is, of course, a matter for the discretion of the judge; but generally it cannot be sufficient for someone merely to assert that the disclosure of the identity of a person or of a document, or of the number of persons who were present at a meeting, or who was present at the meeting, or who on behalf of the client (if the person making the assertion is a solicitor) spoke to him or that he spoke to a particular officer of the client, to enliven a claim of legal professional privilege.

What S did in this case was simply to make a bald assertion that to answer certain questions or to identify particular documents would be to disclose matters which would reveal privileged communications. But if an assertion of this kind is made under oath how can it be tested, short of requiring the questions to be answered or the documents disclosed? S was in truth performing the function of the Authority because he drew the conclusion which it was for the Authority to reach if material had been put before it from which it could have drawn a conclusion as to whether legal professional privilege was correctly raised. But the material to establish the validity of the claim was never placed before the Authority. It is not sufficient for the person asserting the claim to merely assert it; or, as Brett L.J. said in Gardner v Irvin (1878) 4 Exch 49 at 52, to have a "skeleton".

If S wished to make good his claim to refuse to answer questions or produce documents, it was for him to lead the requisite material so that the Authority could consider its attitude and examine him with respect to it. The procedure that should be adopted before the Authority is akin to a voir dire examination, where, once the claim for privilege is asserted, it is for the person asserting it to lead his evidence or make submissions in support of his claim and for interested parties or the tribunal to test it by cross examination or other evidence. At the conclusion of the voir dire examination the tribunal would then have before it the material to enable it to make a decision as to the correctness of the claim. This procedure was not followed here, doubtless because of the nature of the claim itself which was inseparably associated with the contention of counsel for S that sub-section (3) of s. 30 extended privilege to the mere fact of the communication, an erroneous submission.

The claim for privilege asserted by the respondent before the Authority was a bare or skeletal claim unsupported by any evidence which would have enabled it to assess the correctness of the claim. Faced with a bare assertion of privilege by S, it is difficult to know what counsel assisting the Authority could have asked him or what evidence it could have led to test or refute the correctness of the claim short of disclosing to the Authority the material for which confidentiality was claimed.

In my opinion the Authority correctly concluded on the material before it that the claim of privilege should be rejected.

The orders of the primary Judge were as follows:

"THE COURT ORDERS THAT: 1. Each decision in respect of which application is made for an order of review be set aside. 2. Each document placed in the custody of the Registrar pursuant to s.32(3) of the National Crime Authority Act 1984 in relation to the said applications be delivered to the applicant. 3. The applicant's costs of the said applications be paid by the respondent."

I would allow the appeal, set aside orders 1, 2 and 3 of the primary Judge and affirm each decision in respect of which application was made for an order of review. The respondent, S, should pay the costs of the Authority of the appeal and of the proceeding at first instance.

The effect of s. 32(3) is that S was not entitled to apply to this Court for the review unless he produced the documents the subject of this proceeding to the Authority or placed them in the custody of the Registrar of the Court. S placed the documents in the Registrar's custody where they presently remain. Section 32(5) requires the Court to order the delivery of the documents to the person who lodged them with the Registrar where the Court sets aside the Authority's decision, but no provision is made for the destiny of the documents where the Court affirms the decision under review.

As the documents were produced to the Registrar by S and as they were not produced by S to the Authority, because it was S's contention before the Authority that he was entitled to decline to produce them to the Authority on the ground of legal professional privilege, the documents have therefore not been in the custody of the Authority.

Although the Act is silent on the matter, plainly the documents cannot remain with the Registrar as the review has now been completed. The only person who could have claim to them so far as I can see is S. The Authority did not seek the delivery of the documents to it.

Notwithstanding that Order 2 made by the primary Judge is in terms apt to authorise the delivery of the documents to S, the source of that order was s. 32(5)

The scheme of the National Crime Authority Act 1984 ("the Act") confers an entitlement on a legal practitioner to refuse to comply with a requirement to answer a question or produce a document where a privileged communication would thereby be described: s.30(3). The Authority has to decide whether a claim to such an entitlement is justified: s.32(1). The practitioner then has a right to apply to the Federal Court for an order of review in respect of the decision (s.32(2)) and the Court may in its discretion make an order

In the present case, the claim to be entitled to refuse to answer questions that was in fact made to the Authority was that the respondent could not be required to answer the questions because to do so would disclose the fact of a privileged communication having occurred. This claim was rejected by the Authority. It was held by Jenkinson J. to be incorrect. It was conceded by counsel who appeared before this Court (not being the counsel who appeared before the Authority) to be incorrect. This concession was plainly right.

In the ordinary course, I think that would be the end of the matter. The legislative scheme is designed to provide a judicial determination of questions of privilege which arise in the course of hearings under Part II Division 2 of the Act before the Authority, which for this purpose may be constituted by a person not legally qualified: s.7. The legislation provides for claim, decision on claim, and review of that decision by the Federal Court. The very limited powers given by s.32(4) (either to affirm or set aside the decision) show that the function of the Court really is analogous to that of a trial judge ruling on evidentiary objections in running, with the important difference that a ruling has already been made by the Authority and the Court has only to review the correctness of that ruling.

Doubtless on review to the Court the practitioner would have the opportunity to expand the argument in support of the claim that was made before the Authority, but it remains in essence the decision which was made by the Authority on that claim which the Court must either affirm or set aside. Normally I think the Court would be reluctant to embark on the consideration of a claim which was put on quite a different basis to the one made to the Authority. But because of the course this matter has taken and out of deference to the careful arguments which were advanced on either side, I think it is appropriate to make some observations which may be of assistance in the future conduct of this hearing.

Counsel for the Authority argued that legal professional privilege extends only to communications between client and practitioner, and not to collateral facts independently observed by the practitioner. It was also said the learned primary judge was wrong in holding that the respondent was entitled to the privilege because there was a "theoretical possibility" of disclosure of the substance of the communications. The Authority argued that it was up to the respondent to show that such a possibility existed and that it might lead to the disclosure of protected information. It was said the learned judge erred by, in effect, putting the onus on the Authority to exclude such a possibility. I think that this argument is correct, for the reasons given by Lockhart J. I also agree with his Honour's views as to the procedure which should be adopted before the Authority when such claims arise.

But more fundamentally the Authority says that matters which are merely observed fact, such as the identity of the persons who were present at a meeting, are not within the scope of legal professional privilege in any event. This argument, as I understand it, was put as something quite independent of the onus point. In other words, if the practitioner is asked about the existence of something which is no more than an independently observed fact, the Authority's argument is that the question must be answered whether or not the answer might tend to disclose the subject matter of a privileged communication. (Of course this argument does not suggest that the onus issue might not arise in other settings where the question is not on its face clearly directed towards a matter within the privilege.)

In support of the Authority's argument, reference was made to general statements in Baker v Campbell (1983) 153 CLR 52 defining the privilege.

Such statements are to be found in the judgments of Murphy J. at p 86 and Deane J. at p 116. Perhaps the most apposite statement of the general rule for present purposes that found in the judgment of Dawson J. at p 122 as follows:

"Legal professional privilege attaches only to communications made for the purpose of giving or receiving advice or for use in existing or anticipated litigation. Moreover, if the communication in question is in the form of a document submitted by a client to his solicitor for use in existing or anticipated litigation, privilege will attach to it only if it comes into existence solely for that purpose. The privilege cannot operate to put beyond the reach of the law documentary or other material which has an existence apart from the process of giving or receiving advice or the conduct of litigation. See Grant v Downs (1976) 135 CLR 674. There is no privilege for physical objects other than documents and there is no privilege for documents which are the means of carrying out, or are evidence of, transactions which are not themselves the giving or receiving of advice or part of the conduct of actual or anticipated litigation. Communications which would otherwise be privileged lose their immunity from disclosure if they amount to participation in a crime or a fraud. The compass within which the doctrine of legal professional privilege operates is, therefore, narrow having regard to the principle which it protects."

Reference might also be made to the most recent edition of Cross on Evidence (4th Australian Edition 1991) at p 698 where the discussion of legal professional privilege commences with the following statement by the learned authors:

"The rule is concerned with communications. These may be oral, written or recorded in some mechanical or other form."

And of course s.30(3) itself speaks of "a privileged communication".

Counsel for the respondent argued that, in order to preserve the confidentiality of communications between solicitor and client, the privilege protects all information which a practitioner must have learned only in the carrying out of his professional duties and therefore it includes information obtained or an observation made by a legal practitioner as a result of his engagement as such. Again, this was put as a matter separate from the onus point.

The respondent relied on some English authorities which, at first blush, might seem to support his contention. The earliest, and the one to which attention was mainly directed, was Greenough v Gaskell (1833) 1 My and K 98, 39 ER 618. It is true that in that case Brougham L.C., said at (ER) page 620:

"If touching matters that come within the ordinary scope of professional employment, (solicitors) receive a communication in their professional capacity, either from a client, or on his account, and for his benefit in the transaction of his business, or, which amounts to the same thing, if they commit to paper, in the course of their employment on his behalf, matters which they know only through their professional relation to the client, they are not only justified in withholding such matters, but bound to withhold them, and will not be compelled to disclose the information or produce the papers in any court of law or equity, either as party or as witness."

(Emphasis added)

However insofar as the nature of the documents in question can be gleaned from the report (they are described at p 621 as "divers books etc containing entries and memorandums, and also divers papers and letters, relative to the matters in the bill mentioned") there is nothing to suggest that they were not communications or records thereof.

The real point at issue was whether the privilege only extended to communications which related to a case where proceedings had commenced or were in contemplation. The Lord Chancellor, after a detailed review of the authorities, concluded that the rule was not so limited. This appears from the following passage, which is also noteworthy as an eloquent statement of the rationale underlining the privilege and one that is completely consistent with modern authority. The Lord Chancellor said (at p 620):

"The foundation of this rule is not difficult to discover. It is not (as has sometimes been said) on account of any particular importance which the law attributes to the business of legal professors, or any particular disposition to afford them protection, though certainly it may not be very easy to discover why a like privilege has been refused to others, and especially to medical advisers. But it is out of regard to the interests of justice, which cannot be upholden and to the administration of justice, which cannot go on, without the aid of men skilled in jurisprudence, in the practice of the Courts, and in those matters affecting rights and obligations which form the subject of all judicial proceedings. If the privilege did not exist at all, everyone would be thrown upon his own legal resources; deprived of all professional assistance, a man would not venture to consult any skilful person, or would only dare to tell his counsellor half his case. If the privilege were confined to communications connected with suits begun, or intended, or intended, or expected, or apprehended, no-one could safely adopt such precautions as might eventually render any proceedings successful, or all proceedings superfluous."

In summarising the authorities which were said to be to the contrary, the Lord Chancellor said something which shows that communication is an essential element of the privilege. The "apparent exceptions", his Lordship said (at p 621), included cases:

"....where there could not be said, in any correctness of speech, to be a communication at all; as where, for instance, a fact, something that was done, became known to him, from his having been brought to a certain place by the circumstances of his being the attorney, but of which fact any other man, if there, would have been equally conusant (and even if this has been held privileged in some of the cases)..... In all such cases, it is plain that the attorney is not called upon to disclose matters which can be said to have learned by communication with his client or on his client's behalf, matters which were so committed to him in his capacity of attorney, and matters in which that capacity alone he had come to know."

A case which might seem to raise the point directly was Wheatley v Williams (1836) 1 M and W 533, 150 ER 546. One of the issues in the case was whether a letter, alleged to constitute a promissory note, had been stamped after it was written and signed. A solicitor for one of the parties was called and asked whether the letter bore a stamp or not on the date it was signed. The objection of privilege was upheld by the Court of Exchequer Chamber. Some of the judgments are very broadly expressed. Alderson B. says (at p 549):

"I think the privilege extends to all knowledge that the attorney obtains, which he would not have obtained but for his being consulted professionally by his client."

But again it seems that the real basis of the objection was that a communication was involved. The objection taken at trial, according to the report, was stated to be "on the ground that the showing of the paper to him was a privileged communication" (at p 548) and Lord Abinger C.B. said (at p 549):

"If, therefore, a document be exhibited to the attorney in pursuance of a confidential consultation with his client, all that appears on the face of such document is a part of the confidential communication."

I think therefore Wheatley v Williams was not treated as a case of involving facts observed by the practitioner independently of a communication with his client. If that view is incorrect then I think Wheatley v Williams is inconsistent with later authority, and in particular Brown v Foster (1857) 1 H and N 736, 156 ER 1397.

In Brown v Foster the defendant had prosecuted the plaintiff for embezzlement. The plaintiff had appeared in the Police Court in answer to the charge and it was proved that on a particular day the plaintiff, who was employed by the defendant as a clerk, had received from one Cleaver a sum of money on account of the defendant. The defendant's account books were produced and examined by counsel who appeared for the plaintiff and by the Magistrate and no entry in respect of that sum was found in them. The plaintiff was remanded on bail and on a subsequent occasion the books were again produced and this time they appeared to contain an entry recording the payment received from Cleaver. The Magistrate dismissed the charge and the plaintiff sued for malicious prosecution. The defendant contended that the plaintiff had obtained access to the books and had made the entry after the first hearing. At the instance of the Lord Chief Justice, who was presiding at the trial, counsel who had appeared for the plaintiff before the Magistrate was called. (It rather seems from the report that counsel was not appearing in the malicious prosecution trial but simply happened to be in court.) In evidence counsel stated that the entry had not been in the book on the day of the first hearing. An order for a rule nisi was obtained on the ground of the improper reception of that evidence. It was argued that the privilege extended "to all collateral information required by the legal adviser while acting in his professional character". Reference was made to Wheatley v Williams and Greenough v Gaskell. To the contrary, in support of the reception of the evidence, it was argued that the privilege only extends to matters "which the client has put it in the power of the legal adviser to learn. It must, in some sense, be a communication which the client has made to him". This argument was upheld. Martin B. said (at p 1399):

"The counsel was called to state, not what he learned from his client, but whether on a particular occasion he saw a certain book, and whether a certain entry was then in that book. There is no breach of professional confidence in answering those questions. I agree that what passes between counsel and client ought not to be communicated and it is not admissible in evidence, but with respect to matters which the counsel sees with his eyes, he cannot refuse to answer."

Pollock C.B. and Watson B. gave judgment to the same effect.

Brown v Foster seems to raise squarely the point under consideration. The witness only learned of the relevant fact because of his engagement as counsel by the plaintiff, but there was no question of any communication between his client and himself concerning that fact.

In Kennedy v Lyell, Brown v Foster was cited with approval by Cotton L.J. (1883) 23 ChD 387 at p 406 and the judgment of Cotton L.J. was subsequently approved by the House of Lords: (1883) App Cas 81. Kennedy v Lyell itself held that a party could rely on the privilege in refusing to answer an interrogatory about information received from his solicitors because the information in question was not merely "the statement of a fact patent to the senses but is the result of the solicitor's mind working upon and acting as professional adviser with reference to facts which he has seen or heard of" (23 ChD at p 407).

Ex parte Campbell: in re Cathcart (1870) 5 Ch App 703 at p 705 was relied on by the respondent but the passage seems to tend the other way.

It was contended that a solicitor could not be asked to disclose the address of his client because that was knowledge which came to him in the course of his professional capacity. That claim was rejected although it was said that if the address was communicated in confidence for the purpose of advice it would be privileged.

Reference was also made to Packer v Deputy Commissioner of Taxation (1988) 1 Qd R 275 but that case did no more than hold that solicitors' trust account ledgers are ordinarily not within the privilege.

To my mind, the general restatements of the doctrine of legal professional privilege by the High Court in Grant v Downs and Baker v Campbell and an examination of older authorities touching on the particular point both lead to the conclusion that it is only communications which are privileged. The privilege does not prevent a legal adviser being required to give evidence of observed fact, notwithstanding that he observed that fact while acting in the course of a retainer and would not have observed the fact had he not been so retained.

Such a conclusion is consistent with the underlying rationale of legal professional privilege. The doctrine does not depend on some notion that the lawyer's knowledge becomes the property of his client. Rather it is conferred to protect and encourage frank and full communication between lawyer and client, for the reasons given by Lord Chancellor Brougham in 1833 and restated by the High Court in recent times.

In my opinion the appeal should be allowed. I agree with the orders proposed by Lockhart J.