FEDERAL COURT OF AUSTRALIA Australian Competition & Consumer Commission v World Netsafe [2002] FCA 527 AUSTRALIAN COMPETITION AND CONSUMER COMMISSION v WORLD NETSAFE PTY LTD and ANOR No Q 297 of 1999 SPENDER J BRISBANE 24 APRIL 2002 IN THE FEDERAL COURT OF AUSTRALIA QUEENSLAND DISTRICT REGISTRY Q 297 OF 1999 BETWEEN: AUSTRALIAN COMPETITION AND CONSUMER COMMISSION APPLICANT AND: WORLD NETSAFE PTY LTD FIRST RESPONDENT TERENCE BUTLER SECOND RESPONDENT JUDGE: SPENDER J DATE OF ORDER: 24 APRIL 2002 WHERE MADE: BRISBANE THE COURT ORDERS THAT: 1. Client professional privilege attaches to the last sentence in par 10 on page 5 and to par 11. 2. Client professional privilege does not attach to pars 9 and 18. Note: Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules. IN THE FEDERAL COURT OF AUSTRALIA QUEENSLAND DISTRICT REGISTRY Q 297 OF 1999 BETWEEN: AUSTRALIAN COMPETITION AND CONSUMER COMMISSION APPLICANT AND: WORLD NETSAFE PTY LTD FIRST RESPONDENT TERENCE BUTLER SECOND RESPONDENT JUDGE: SPENDER J DATE: 24 APRIL 2002 PLACE: BRISBANE REASONS FOR RULING ON EVIDENCE – NO. 3 1 Objection is taken to the specified parts of an affidavit by Mark Thomas McCluskey. Mr McCluskey is still on the roll of practitioners to the High Court and on the roll of solicitors of the Supreme Court of Queensland. In his affidavit he claims to have retired from practice as a solicitor in 1994 but works from time to time as a commercial consultant to businesses. In the present circumstances, the relevant engagement is the acceptance by him of a position as consultant to World Netsafe, the style of his appointment being "Corporate Counsel". 2 Objection is taken by the second respondent to specific paragraphs of Mr McCluskey's affidavit - pars 9, 10, 11, 18 and 25. Paragraph 25 is now no longer pressed by the ACCC. It seems to me that the implied concession in that circumstance is not an irrelevant factor in relation to the nature of the relationship that existed at the relevant time between World Netsafe and Mr McCluskey. 3 The position of solicitor and client is not as clear cut in this case as it is where a client employs a solicitor as an independent contractor in respect of a particular matter, or on an ongoing basis. Nonetheless, it is clear that client professional privilege can attach to communications between an employed or salaried solicitor and his employer. In particular, see the observations of Mason and Wilson JJ in Waterford v The Commonwealth of Australia (1986-1987) 163 CLR 54 at 60 to 61. 4 The question in this case is whether the nature of the relationship between Mr McCluskey and World Netsafe had the qualities of confidentiality and independence which are necessary to attract the privilege. Secondly, even if that relationship is established, it is necessary to have regard to the actual communication which is said to be made in breach of that privilege. I am satisfied that, in the circumstances of this case, a number of the communications to which objection is taken are communications which attract client professional privilege. 5 However, I do not think that the words said by Mr Butler to Mr McCluskey referred to in par 9 is a communication subject to the privilege. In relation to par 10, I hold that privilege attaches to the last sentence of page 5. I do not think the other parts of that paragraph are within ss 118 or 119 of the Evidence Act 1995 (Cth). In my opinion, both the communication by Mr McCluskey to Mr Butler referred to in par 11 and Mr Butler's response are such as to attract the privilege, as these are clearly communications between a lawyer and his employer in relation to court proceedings to which the company is exposed. 6 In my judgment, the privilege does not attach to the communication referred to in par 18. I am of the opinion that initiating instructions to a solicitor are not within the communications the subject of the privilege referred to in ss 118 and 119. This is to be contrasted with anything done or any advice given as a result of the requested assistance. As I indicated earlier, it is accepted that the communications referred to in par 25 are no longer pressed in light of the opposition to the reception of that evidence as being an unauthorised disclosure of communications the subject of client professional privilege. I certify that the preceding six (6) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Spender. Associate: Dated: 29 April 2002 Counsel for the Applicant: Mr P.L. O'Shea SC, with Mr A.M. Pomerenke Solicitor for the Applicant: Corrs Chambers Westgarth Counsel for the Respondent: Mr M.M. Stewart SC, with Mr G.A. Wilkins Solicitor for the Respondent: Redmond van de Graff Date of Hearing: 24 April 2002 Date of Judgment: 24 April 2002