Case: Mann v Carnell [1999] HCA 66 ; (1999) 201 CLR 1
Outcome: applied
kind of waiver that is in issue in this case is commonly referred to as imputed or implied waiver. The former expression is preferable, as it reflects the way in which the High Court expressed the governing legal principles in Mann v Carnell [1999] HCA 66 ; (1999) 201 CLR 1 ( 'Mann' ). In Mann at 13 [29], Gleeson CJ, Gaudron, Gummow and Callinan JJ said: may be express or implied. Disputes as to implied waiver usually arise from the need to decide whether particular conduct is inconsistent with the maintenance of the confidentiality which the privilege is intended to protect. When an affirmative answer is given to such a question, it is sometimes said that waiver is "imputed by operation of law". This means that the law recognises the inconsistency and determines its consequences, even though such consequences may not reflect the subjective intention of the party who has lost the privilege. Thus, in Benecke v National Australia Bank , the client was held to have waived privilege by giving evidence, in legal proceedings, concerning her instructions to a barrister in related proceedings, even though she apparently believed she could prevent the barrister from giving the barrister's version of those instructions. She did not subjectively intend to abandon the privilege. She may not even have turned her mind to the question. However, her intentional act was inconsistent with the maintenance of the confidentiality of the communication. What brings about the waiver is the inconsistency, which the courts, where necessary informed by considerations of fairness, perceive, between the conduct of the client and maintenance of the confidentiality; not some overriding principle of fairness operating at large.' The concluding part of this passage draws attention to the fact that the test for imputed waiver had previously been expressed in terms of fairness: see Attorney-General (NT) v Maurice [1986] HCA 80 ; (1986) 161 CLR 475 (' Maurice' ) at 481 per Gibbs CJ, 487 488 per Mason and Brennan JJ, 492 493 per Deane J, and 497 498 per Dawson J. Under the test propounded in Mann , it is inconsistency between the conduct of the client and the maintenance of the confidentiality that the privilege is intended to protect which effects a waiver of the privilege. Fairness has become a subsidiary consideration; it may be relevant to the court's assessment of inconsistency in some contexts but not in others. In Commissioner of Taxation v Rio Tinto Limited [2006] FCAFC 86 (' Rio Tinto' ) at [44], the Full Court (Kenny, Stone and Edmonds JJ) said that there was a good deal of doubt whether the language used by the majority in Mann worked any real change in the principle which governs imputed waiver. This observation was made somewhat tentatively and was not material to the Court's decision. My own view is that a test expressed in terms of inconsistency more readily accommodates the variety of situations in which questions of imputed waiver can arise than a test expressed in terms of fairness. The criterion of fairness is readily understandable in the context of inter partes litigation, but it is difficult to apply sensibly in other contexts: see the observations by McHugh J in Mann at 40 [128] and Toohey J in Goldberg v Ng [1995] HCA 39 ; (1995) 185 CLR 83 (' Goldberg v Ng' ) at 110. AWB submitted that this Court should hold that there has been no imputed waiver because the Commonwealth has made no attempt to identify why it would be unfair or inequitable for AWB to maintain privilege in the underlying investigations. This submission immediately raises the question unfair or inequitable to whom? I doubt that any question arises of fairness to the Commission it is an arm of the executive government charged with the investigation of specified matters. Nor does any question arise of fairness to the Commonwealth. Fairness presupposes a balancing of interests between parties who are in dispute. In that context, partial disclosures raise a question of fairness because there is the capacity to mislead one party to the dispute to his or her detriment. These concepts do not translate easily to the present case: cf McHugh J in Mann at 40 [127]-[128]. There is also the difficulty that, outside the framework of an inter partes dispute, fairness is truly a term of 'indeterminate reference': Mann at 40 [129] per McHugh J, citing RJ Desiatnik, Legal Professional Privilege in Australia , 1999, p 122. Mann anticipated that there will be cases in which considerations of fairness have little or no role to play. This is such a case. The broad question posed by Mann is whether, and to what extent, AWB's disclosures are inconsistent with the maintenance of confidentiality in the documents which are at issue in these proceedings. This question wraps up several subsidiary issues, in particular whether AWB's disclosures involved, on each occasion, a disclosure of the gist or substance of its legal advice, whether AWB consciously deployed that advice so as to advance its own commercial or other interests, and, if so, whether that disclosure has resulted in an imputed waiver of privilege over any and what associated materials. In any application of Mann , the starting point must be an analysis of the disclosures or other acts or omissions of the party claiming privilege that are said to be inconsistent with the maintenance of confidentiality in the privileged material: see Rio Tinto at [45]. The disclosures in question here were made variously to the IIC, to the Australian Government, to the Commission and in some instances via the procedures of the Commission to the public at large. In my opinion, there is no reason why these disclosures cannot support a finding that AWB has waived legal professional privilege over associated material. AWB submitted that imputed waiver cannot arise in the context of a commission established under the RCA. Alternatively, it submitted that the coercive and inquisitorial context in which the alleged waiver has taken place is an important factor which strongly militates against waiver. These submissions ignore the voluntary disclosures that AWB made to the Australian Government. In any event, I am not persuaded that AWB's disclosures to the Commission and the IIC are incapable of giving rise to an imputed waiver. Leaving aside any question of waiver, AWB was entitled to maintain legal professional privilege in the course of proceedings before the Commission and, by and large, it sought to do so. To the extent that AWB has already produced documents to the Commission containing legal advice or instructions, it did so because it recognised that actions it had taken outside the Commission had the consequence of waiving privilege over those documents. As for the oral evidence that the Commonwealth now relies upon, Lindberg, Cooper and Scales were senior executives of AWB when they gave that evidence to the Commission. There is nothing before me to suggest that they were not speaking as executives of AWB when they gave their evidence, or that their evidence fell outside the scope of their authority from AWB. Further, their evidence was given in the presence of AWB's legal representatives, without any objection being raised on grounds of legal professional privilege. Lindberg, Cooper and Scales may have been compelled to give evidence at the Commission, but they were under no compulsion to reveal the gist or substance of legal advice that had been obtained by AWB. The disclosure of privileged communications to a third party can result in an imputed waiver of privilege, even if there is no intention of waiving privilege and the disclosure is for a limited and specific purpose. In Mann , the Chief Minister of the Australian Capital Territory conveyed legal advice, on a confidential basis, to a member of the Territory's Legislative Assembly to enable him to consider the reasonableness of the Government's decision to settle certain legal proceedings. The majority decision turned on the fact that the disclosure to a member of the Legislative Assembly was not regarded as disclosure to a third party. In their joint judgment, Gleeson CJ, Gaudron, Gummow and Callinan JJ said at 15 [35] that: purpose of the privilege being to protect the Territory from subsequent disclosure of the legal advice it received concerning the litigation instituted by the appellant, there was nothing inconsistent with that purpose in the Chief Minister conveying the terms of that advice, on a confidential basis, to a member of the Legislative Assembly who wished to consider the reasonableness of the conduct of the Territory in relation to the litigation.' However, their Honours also observed that, while the voluntary disclosure of privileged legal advice to a third party will not necessarily waive privilege, it can do so. They said that Goldberg v Ng illustrates that, depending on the circumstances, the disclosure of a privileged communication to a third party for a limited and specific purpose, and on terms as to confidentiality, can have the consequence of waiving privilege. In Network Ten Ltd v Capital Television Holdings Ltd (1995) 36 NSWLR 275, which predated Goldberg v Ng and Mann , Giles J held that a limited and specific disclosure of privileged material, on terms of confidentiality, did not result in a loss of privilege. In Australian Rugby Union Ltd v Hospitality Group Pty Ltd (1999) 165 ALR 253, Sackville J said that it follows from Goldberg v Ng that the disclosure of a privileged communication for a limited purpose and subject to a confidentiality requirement may, or may not, amount to a waiver of privilege, depending on the circumstances of the case: at 262-263 [42]-[43]. On the facts of that case, Sackville J held that a disclosure of legal advice to the solicitors and representatives of two other companies, on strict terms as to confidentiality and for the purpose of those other companies obtaining legal advice, did not result in an imputed waiver. His Honour distinguished Goldberg v Ng as a case in which the disclosure was made to gain an advantage over the opposing party in related litigation: at 263 [45].