AWB Limited v Honourable Terence Rhoderic Hudson Cole [2006] FCA 571

FEDERAL COURT OF AUSTRALIA AWB Limited v Honourable Terence Rhoderic Hudson Cole [2006] FCA 571 EXPLANATORY STATEMENT It is the practice of this Court in matters which are of significant public interest to make a brief explanatory statement when delivering judgment. The statement I now make describes the main issues in the proceedings and the conclusions I have reached. As it is a summary statement only, it is necessarily incomplete. The only authoritative pronouncement of the Court's reasons and conclusions is that contained in the published reasons for judgment. The case concerns a document entitled 'Cole Inquiry – Draft Statement of Contrition – Andrew Lindberg.' The document became Exhibit 665 in the Commission of Inquiry which is being conducted by Commissioner Cole ('the Inquiry') under the Royal Commissions Act 1902 ('RCA'). The document was inadvertently produced by AWB Limited ('AWB') to the Inquiry in response to a notice to produce documents. In these proceedings it was common ground that any legal professional privilege attaching to the document had not been waived by its inadvertent production. After hearing evidence and submissions concerning Exhibit 665 on 24 and 27 March 2006, the Commissioner said that the RCA confers an ancillary or incidental power on him to determine whether the claim of legal professional privilege had been established in respect of Exhibit 665. On the evidence before him, the Commissioner ruled that Exhibit 665 was not privileged. I have not undertaken a judicial review of the Commissioner's rulings. In accordance with the submissions made by AWB and the Commonwealth and pursuant to the jurisdiction conferred upon me by s 39B of the Judiciary Act 1903 (Cth), I have independently considered the questions that arise in this case, including the question whether Exhibit 665 attracts legal professional privilege having regard to the more extensive evidence adduced in this Court. The major impetus for the creation of Exhibit 665 was advice that AWB obtained from Dr Peter Sandman, a crisis management expert and public relations consultant, to the effect that AWB should 'over-apologise', sooner rather than later and via a statement by its managing director, so as to deal with the reputational damage AWB had sustained and was likely to sustain in future in connection with the Inquiry. Exhibit 665 was drafted by Mr Lindberg, who was then the chief executive officer of AWB, following a telephone conference that took place on 21 December 2005. The participants in the telephone conference were Mr Lindberg, Dr Sandman, Mr Zwier from Arnold Bloch Leibler (the solicitors for AWB) and a number of employees of AWB. After the telephone conference, Mr Zwier provided written advice to AWB in an email dated 23 December 2005. Mr Lindberg based his draft very closely on the advice he had received from Mr Zwier. After preparing the draft statement of contrition, Mr Lindberg gave instructions for it to be circulated by email to the persons who had participated in the telephone conference of 21 December 2005. The draft was circulated in anticipation of another telephone conference scheduled for Monday 2 January 2006. Legal professional privilege is a rule of substantive law that reflects an important common law immunity. It was common ground before me that it is not abrogated by any of the provisions of the RCA. AWB carries the onus of establishing that Exhibit 665 is privileged. AWB contended before me that legal professional privilege attaches to Exhibit 665 on one or other of the following grounds. First, AWB contended that Exhibit 665 was brought into existence for the dominant purpose of obtaining legal advice from Mr Zwier. Secondly, AWB contended that it was privileged because it was based closely on Mr Zwier's advice. And thirdly, it contended that Exhibit 665 was brought into existence for the dominant purpose of being used in relation to litigation, the relevant litigation being either that constituted by the Inquiry itself or that which might arise following the Inquiry. On the evidence before me, I have reached the following conclusions: (1) I am not satisfied that Exhibit 665 was brought into existence, and circulated by email, for the dominant purpose of obtaining legal advice. (2) Exhibit 665 would not, if disclosed, allow a reader to know or infer the nature, content or substance of any legal advice given by Mr Zwier to Mr Lindberg and AWB; nor would the disclosure of Exhibit 665 result in any waiver of the privilege inhering in that legal advice. (3) The litigation limb of legal professional privilege does not extend to documents brought into existence for use in relation to a commission of inquiry. Further, Exhibit 665 was not brought into existence for the dominant purpose of being used in connection with litigation which might follow from the report of the Commissioner. I have, accordingly, rejected AWB's claim for a declaration that Exhibit 665 is protected by legal professional privilege. I have also rejected AWB's claim for injunctions restraining the Commissioner from using or publishing Exhibit 665 and requiring that it be returned to AWB. AWB also sought declarations that the Commissioner does not have the power to order the production of a privileged document or to determine whether a document is protected by legal professional privilege. Alternatively, AWB sought a declaration that the Commissioner should not determine whether a claim for legal professional privilege is established. I have concluded that these declarations should not be granted. In some respects they do not reflect the issues that were litigated in this Court, and in other respects they are contrary to the conclusions I have reached. In this Court, the dispute between AWB and the Commonwealth concerning the Commissioner's powers under the RCA was quite narrow. It was essentially common ground between them, and I have found, that the Commissioner had an administrative power or capacity, for the purpose of determining his own actions and procedures, to form an opinion that Exhibit 665 was required to be produced under the notice because it was not privileged. In this sense, the Commissioner had the power to accept or reject the claim of privilege that was made to him. The legal effect of the Commissioner's ruling was in dispute, at least to some extent. The conclusion I have reached is that the Commissioner's opinion or ruling had no binding force or effect in point of law, and it was open to either party to bring declaratory proceedings in this Court without embarking upon any review of the Commissioner's decision. I will order that the application be dismissed. I will hear submissions on the question of costs.