FEDERAL COURT OF AUSTRALIA Hazledine v Arthur J Gallagher & Co Limited (No 3) [2017] FCA 1271 File number: SAD 338 of 2016 Judge: KERR J Date of judgment: 24 October 2017 Catchwords: PRACTICE AND PROCEDURE – submission that the Federal Court of Australia is bound by s 67E of the Evidence Act 1929 (SA) – State Act to be construed as applying only to proceedings in a court of South Australia – State law otherwise inconsistent with Commonwealth law – Commonwealth law prevails where inconsistency arises – proceedings commenced in original jurisdiction of the Federal Court of Australia – Evidence Act 1995 (Cth) covers the field with respect to privileges available to resist compulsion to produce otherwise relevant evidence Legislation: Constitution s 109 Evidence Act 1995 (Cth) s 4 Federal Court of Australia Act 1976 (Cth) s 59 Judiciary Act 1903 (Cth) s 79 Federal Court Rules 2011 (Cth) div 24.2 Evidence Act 1929 (SA) s 67E Cases cited: P v P [1994] HCA 20; (1994) 181 CLR 583 Rizeq v The State of Western Australia [2017] HCA 23; (2017) 91 ALJR 707 Date of hearing: 24 October 2017 Registry: South Australia Division: General Division National Practice Area: Administrative and Constitutional Law and Human Rights Category: Catchwords Number of paragraphs: 16 Counsel for the Applicant: Mr T Hurren Solicitor for the Applicant: Harmers Workplace Lawyers Counsel for the Respondent: Ms R Nelson Solicitor for the Respondent: Sparke Helmore ORDERS SAD 338 of 2016 BETWEEN: KARREN HAZLEDINE Applicant AND: ARTHUR J GALLAGHER & CO (AUS) LIMITED Respondent JUDGE: KERR J DATE OF ORDER: 24 OCTOBER 2017 THE COURT ORDERS THAT: 1. The Applicant's objection to the production of the subpoenaed documents of Ms Fiona Fallo is dismissed. Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011. REASONS FOR JUDGMENT (Revised from the transcript) KERR J: 1 A subpoena to produce documents was issued to the Applicant's psychologist Ms Fiona Fallo on 28 September 2017. Ms Fallo objected to the production of the subpoenaed documents on the grounds that it involved the confidential records of a patient and was likely to harm the therapeutic relationship that had been established between herself and the Applicant in these proceedings. While I accepted the force of Ms Fallo's concerns regarding the confidentiality of her therapeutic counselling I dismissed that objection (subject to claims for legal professional privilege to be determined) on the basis that the Applicant had by her pleadings put the causation of her psychological condition in issue in these proceedings and those documents were clearly relevant. 2 Counsel for the Applicant, without notice either to the Respondent or the Court, thereupon made an oral application objecting to the subpoena on a different basis. Mr Hurren submitted that inspection of the documents Ms Fallo had produced is prohibited having regard to the terms of s 67E of the Evidence Act 1929 (SA) (the South Australian Act). 3 Section 67E of the South Australian Act provides as follows: Certain communications to be protected by public interest immunity (1) A communication relating to a victim or alleged victim of a sexual offence is, if made in a therapeutic context, protected from disclosure in legal proceedings by public interest immunity. (2) However, the following communications are not subject to public interest immunity: (a) a communication made for the purposes of, or in the course of, a physical examination of the victim or alleged victim of a sexual offence by a registered medical practitioner or registered nurse; or (b) a communication made for the purposes of legal proceedings arising from the commission of the alleged offence or for commencing such legal proceedings; or (c) a communication as to which reasonable grounds exist to suspect that the communication evidences a criminal fraud, an attempt to pervert the administration of justice, perjury or another offence. (3) A public interest immunity arising under this section cannot be waived by – (a) the counsellor or therapist; or (b) a party to the protected communication; or (c) the victim or alleged victim of the sexual offence or the guardian of the victim or alleged victim. 4 Counsel for the Applicant submitted that s 67E of the South Australian Act was binding on this Court by virtue of s 79 of the Judiciary Act 1903 (Cth) (the Judiciary Act). consideration 5 The starting point for any analysis of the interaction between State and Commonwealth laws is that expressed by Kiefel CJ in Rizeq v The State of Western Australia [2017] HCA 23; (2017) 91 ALJR 707 at [15] in which her Honour discussed the purpose and operation of s 79(1) of the Judiciary Act. Her Honour observed: State laws of the kind mentioned [laws of a State relating to procedure, evidence and the compellability of witnesses as referred to in s 79 of the Judiciary Act] cannot apply of their own force to State courts exercising federal jurisdiction in that State. State legislatures have no constitutional power to make such laws. When an exercise of legislative power is directed to the judicial power of the Commonwealth, it must operate through, or in conformity with, Ch III of the Constitution. (Citations omitted) 6 The supremacy of Commonwealth laws when inconsistent with State laws is mandated by s 109 of the Constitution. Cases such as P v P [1994] HCA 20; (1994) 181 CLR 583 reflect that basic principle. 7 This is not a State court. There is no basis for Mr Hurren's submission that State and Territory laws are picked up under s 79 of the Judiciary Act as rules of evidence in a proceeding commenced in this Court. Section 4(1)(b) read together with s 8(1) of the Evidence Act 1995 (Cth) (the Commonwealth Act) requires the contrary conclusion. 8 Thus Odgers S, Uniform Evidence Law 12th ed, Thomson Reuters, 2016 (at [EA.8.60] pages 62 - 63) observes: It is suggested that the Commonwealth provision creates a hierarchy among Commonwealth laws: 1. The provisions of other Commonwealth laws (except ss 68, 79, 80 and 80A of the Judiciary Act 1903) and of regulations which were in force on the commencement of this Act (and until they are amended) prevail over this Act. 2. This Act prevails over ss 68, 79, 80 and 80A of the Judiciary Act 1903, but they continue to operate subject to any inconsistency with this Act. 9 Having discussed the relevant case law, Odgers states (at [EA8.60] page 64): Thus, federal courts … will only apply the rules of admissibility in this Act. For this reason, Branson J held in Violi v Berridale Orchards Ltd (2000) 99 FCR 580; 173 ALR 818; [2000] FCA 797 at [45] that the intent behind s 138 (in Chapter 3 of the Act) was inconsistent with the continued operation of s 13 of the Listening Devices Act 1984 (NSW) in the Federal Court. Similarly, the rules relating to the competence and compellability of witnesses (Div 1 of Pt 2.1) cover the field since s 12 provides: 12. Except as otherwise provided by this Act: (a) every person is competent to give evidence; and (b) a person who is competent to give evidence about a fact is compellable to give that evidence. 10 I respectfully agree with, and adopt the learned author's observations as set out above. 11 These proceedings are in the original jurisdiction of the Federal Court of Australia. The Commonwealth Act therefore applies to them. 12 The better view is that s 67E of the State Act should be construed as applying only to proceedings in a court of the State of South Australia. Such a reading appears open. It is to be preferred because, so construed, no question of inconsistency arises—the provision simply has no application to these proceedings. 13 However, if I am wrong in that regard, in so far as s 67E purports to protect a communication from disclosure by reason of public interest immunity in a proceeding to which the Commonwealth Act applies, then, to the extent of any inconsistency, it is invalid by reason of the operation of s 109 of the Constitution. 14 In my opinion Part 3.10 of the Commonwealth Act covers the field with respect to the various privileges (Division 1 – Client Legal Privilege, Division 1C – Journalist Privilege, Division 2 – Other Privileges, and Division 3 – Evidence Excluded in the Public Interest) that may be asserted by a party or non-party to resist the compulsion to produce otherwise relevant evidence in a proceeding to which the Commonwealth Act applies. The public interest immunity as expressed by s 67E of the State Act which Mr Hurren relies on as a basis to set aside the subpoena addressed to Ms Fallo requires a further privilege beyond those legislated for by the Commonwealth Parliament to be recognised by this Court. For such a privilege to apply in Commonwealth proceedings would require an amendment to the Commonwealth Act. 15 None of the exceptions provided for by s 9 of the Commonwealth Act are applicable. In the absence of any provision of the Commonwealth Act to establish such a privilege s 67E of the State Act would also be directly inconsistent in its operation with s 59 of the Federal Court of Australia Act 1976 (Cth) and Division 24.2 of the Federal Court Rules 2011 (Cth) which provide both the authority for subpoenas to be issued, and the mechanisms by which the Court is to determine whether or not such a subpoena is to be set aside. It would impede this Court having regard to relevant evidence. 16 Mr Hurren's application on the plaintiff's behalf to set aside the subpoena to Ms Fallo must be dismissed. I will hear the parties as to costs. I certify that the preceding sixteen (16) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Kerr. Associate: Dated: 31 October 2017