Case: CJ Redman Constructions Pty Ltd v Tarnap Pty Ltd [2006] NSWSC 173
Outcome: followed
views expressed by Jacobson J are in line with those of Campbell J of the Supreme Court of New South Wales. In CJ Redman Constructions Pty Ltd v Tarnap Pty Ltd [2006] NSWSC 173 , his Honour said (at [5] [7]): It will be apparent that the letter alludes to there being settlement discussions on foot, but gives no detail of those settlement discussions, and, most importantly, does not involve the writer of the letter either making an admission on behalf of his client concerning the matter of the settlement discussion, or attributing any admission to the recipient of the letter. While the letter alludes to it having been the addressee of the letter who had " indicated the possibility of a global resolution to all outstanding matters ", I do not see that as involving any admission it is possible for a person to want to resolve a dispute which he or she regards as totally unmeritorious. The letter is one which one would not be within the rationale of the common law concerning legal professional privilege. That rationale is that people should be free to explore settlement of disputes, and make admissions in the course of those discussions, safe in the knowledge that any admissions which they make will not be tendered against them later in Court, if the negotiations break down. The wording of section 131(1) is capable, on one reading of the expression " in connection with ", of extending wider than did the common law. There is, in one sense of it, a connection between this letter and the settlement negotiations, because the letter talks about the settlement negotiations. However, the expression " in connection with ", while sometimes capable of referring to a connection of any kind between two subject matters, does not always have that reference: cf Wonall Pty Ltd v Clarence Property Corporation Ltd [2003] NSWSC 497 ; [2003] 58 NSWLR 23 at 44-45. It is necessary to look to the context in which the expression occurs to determine its particular meaning, in that particular context. In the particular context of section 131 , it seems to me that the expression "in connection with" does not extend to any connection of any kind whatever. Rather, the expression needs to be construed by reference to the purpose of the without prejudice privilege. I see no basis for concluding that the rationale of the without prejudice privilege under section 131 of the Evidence Act is any different to the common law. There are some exceptions to the privilege, in section 131(2) , which go wider than the exceptions to the privilege at common law, but I see no basis for concluding that the fundamental prohibition contained in section 131(1) has any different rationale to the common law on the topics. The ACCC did not suggest that it could invoke any of the exceptions to the operation of s 131(1) specified in s 131(2). The ACCC's sole submission was that the copy of the first BDO report furnished to it on 26 September 2008 was not protected by s 131(1) because it was provided for mixed purposes, one of which was for use in the litigation between the ACCC and Allphones in this Court. This submission ignores the terms of the Phillips Fox letters of 17 and 26 September 2008 and the terms of the Notice of Dispute itself. In the first of those letters, Phillips Fox deferred any commitment to the proposition that the report could be used for the purposes of that litigation. In the second of those letters, Phillips Fox made quite clear that it was not prepared to accede to the request made by Corrs that Allphones agree that the report be able to be admitted into evidence in the litigation in this Court. It restricted the use to the dispute resolution process then under way and requested that the documents be treated as " confidential and without prejudice ". In CJ Redman Constructions Pty Ltd [2006] NSWSC 173 , Campbell J focussed particularly on the rationale for the without prejudice privilege at common law, namely, that people should be free to explore the settlement of disputes and to make admissions in the course of those discussions, safe in the knowledge that any admissions which they make will not be tendered against them later in Court, if the negotiations break down.