Case: Bennett v Chief Executive Officer of the Australian Customs Service [2004] FCAFC 237 ; (2004) 140 FCR 101
Outcome: followed
The parties were in agreement that the appropriate test to be applied in determining whether or not the respondents have waived privilege in the external legal advice referred to in the letter of 19 April 2005 is whether they have in effect disclosed the substance or conclusion of that advice. The test was expressed this way by Gyles J, with whom Tamberlin J agreed, in Bennett v Chief Executive Officer of the Australian Customs Service [2004] FCAFC 237 ; (2004) 140 FCR 101 at [65] where his Honour said: ... The voluntary disclosure of the gist or conclusion of the legal advice amounts to waiver in respect of the whole of the advice to which reference is made including the reasons for the conclusion. 30 In his additional observations in Bennett v Chief Executive Officer of the Australian Customs Service , Tamberlin J at [13] said: Various expressions are used in the formulation of principles relating to waiver of legal professional privilege, such as references to 'the substance', 'effect', or 'content' of the advice. The weight of the authorities, in my view, supports the conclusion that the disclosure of the conclusion reached in or course of action recommended by, an advice can amount to waiver of privilege in respect of the premises relating to the opinion which has been disclosed, notwithstanding that this reasoning is not disclosed. By way of illustration, if there is a disclosure that a client has been advised that interpretation 'A' is preferable to interpretation 'B' of a legislative provision, then even if there is no disclosure of the reasoning leading to that conclusion, the reasoning and content of the advice may be waived, including the factual premises and circumstances leading to that conclusion. His Honour had earlier observed that it "may perhaps have been different" if it had simply been asserted that, in effect, the client had taken legal advice and thereafter adopted a particular position. 31 The critical question concerning the letter dated 19 April 2005 is thus its proper construction. For this reason only limited assistance is provided by consideration of the facts of other cases. It is necessary for me to form a view, after consideration of the whole of the letter of 19 April 2005, as to whether the respondents by that letter deployed the substance or effect of their external legal advice for forensic purposes. Assuming for present purposes the correctness of the proposition tentatively advanced by Tamberlin J (see [30] above), there would have been no waiver if the letter simply asserted, in effect, that PwC had taken legal advice and thereafter acted from 2 July 2004 in the way complained of by Ms Rich. 32 In my view, a fair reading of the letter of 19 April 2005 leads to the conclusion that it was calculated to convey the message that the conduct of PwC from 2 July 2004 was undertaken on external advice and in accordance with that advice, and, for that reason, PwC did not believe that there had been any victimisation or other conduct for which compensation could properly be sought. This conclusion can, it seems to me, be tested by asking whether, were it the case that PwC had acted in disregard of its external advice, or were it the case that its belief that there had not been any victimisation or other conduct for which compensation could properly be sought was inconsistent with its external advice, would the letter have been misleading? In my view, it is plain that it would have been. The statement that PwC had "acted at all times with the benefit of external advice" was apparently made for the purpose of fortifying the claim that it had not engaged in victimisation, or in other conduct for which compensation could properly be sought. Implicit in the calling-in-aid of the external legal advice for this purpose was the claim that the external legal advice supported the conduct of PwC. 33 I therefore reject the submission of the respondents that the letter does not disclose the substance or conclusion of the external advice received by the respondents and that the statement in the letter reproduced in [18] above amounts to a simple assertion that the client has taken legal advice and has acted with the benefit of it.