Industrial Relations Commission of New South Wales in Court Session CITATION : Rabbi Cohen Hallaleh v Cyril Rosenbaum Synagogue and anor [2004] NSWIRComm 51 revised - 14/04/2004 APPLICANT Rabbi Juda Cohen Hallaleh PARTIES : RESPONDENTS Cyril Rosenbaum Synagogue Pty Ltd The Sir Moses Montefiore Jewish Home FILE NUMBER: 7091 of 2002 CORAM: Marks J CATCHWORDS : Unfair contract - Interlocutory judgment - Legal professional privilege - Legal principles concerning circumstances in which privilege deemed waived - Whether relevant nexus between privileged material and state of mind of applicant - Whether state of mind relevant to issue in proceedings - Motion dismissed. LEGISLATION CITED : Industrial Relations Act 1996 Mann v Carnell (1999) 201 CLR 1 Tynan Motors Pty Ltd v Mazda Australia Pty Ltd [2003] NSWIRComm 146 CASES CITED : Telstra Corporation Limited v BT Australasia Pty Ltd (1998) 85 FCR 152 Southern Equities Corporation Ltd (in liquidation) v Arthur Anderson and Co (1997) SASC 6373 DSE (Holdings) Pty Ltd v Intertan Inc [2003] FCA 384 HEARING DATES: 02/18/2004 DATE OF JUDGMENT: 03/24/2004 APPLICANT Ms E Brus of counsel SOLICITORS R J Bartley & Associates LEGAL REPRESENTATIVES: RESPONDENTS Mr AB Gotting of counsel SOLICITORS Minter Ellison JUDGMENT: - 1 - INDUSTRIAL RELATIONS COMMISSION OF NEW SOUTH WALES IN COURT SESSION CORAM: MARKS J Wednesday 24 March 2004 Matter No IRC 7091 of 2002 RABBI JUDA COHEN HALLALEH v CYRIL ROSENBAUM SYNAGOGUE PTY LTD AND ANOR Application under s 106 of the Industrial Relations Act 1996 INTERLOCUTORY JUDGMENT CONCERNING LEGAL PROFESSIONAL PRIVILEGE [2004] NSWIRComm 51 1 These proceedings are currently constituted by an amended summons for relief filed by the applicant Rabbi Juda Cohen Hallaleh on 24 October 2003. The summons seeks certain orders against the first and second respondents Cyril Rosenbaum Synagogue Pty Ltd and The Sir Moses Montefiore Jewish Home under s 106 of the Industrial Relations Act 1996 ("the Act"). The proceedings arise out of his employment with the second respondent and services performed by him for the first respondent. 2 This interlocutory judgment is concerned with an application by the applicant to set aside a summons for production issued on behalf of the respondents seeking the production of certain documents by Mr Irving Wallach, a barrister-at-law. The summons requires the production of "all correspondence, memoranda, advices, file notes and emails from Mr Irving Wallach addressed to the applicant…in relation to [the applicant's] employment with the respondents between the period 1 January 2002 and 1 October 2002". 3 The applicant has sought to have the summons for production set aside on the grounds that the documents are subject to legal privilege. 4 It is necessary for the purpose of dealing with this interlocutory application that I refer briefly to some of the material contained within documentation filed with the court. An affidavit affirmed by the applicant on 18 November 2003 has annexed to it a service agreement with the second respondent which appears to have been entered into in or about January 2000. The document is undated. An agreement made on 31 May 2001 purports to assign this service agreement to the first respondent as employer. The terms of the agreement included the following: a) A term of two years subject to termination upon notice in the event of incapacity or any "wilful material breach or continued neglect" or serious misconduct. b) An agreement by the applicant to waive any right to tenure by reason of any religious principle. c) An acknowledgement that the engagement was for a fixed term and that the employer was under no obligation to offer any further term of employment upon the expiration of that term. 5 An email communication from the then President of the second respondent to the applicant dated 19 November 1999 referred to a proposal that there would be a two year employment contract "which would have provision for renewal". The applicant stated in his affidavit that after receiving the contract, which contained no provision for renewal, he had a conversation with the President in which he referred to the fact that the contract was to contain such a provision. He said that the President replied that the position may not be suitable for the applicant or the applicant might not like the job and that "the extension of the contract will be discussed later on". There was then a conversation in which the applicant referred to the fact that his family would need to join him from overseas and the President is alleged to have said that if the applicant liked the job then the contract would definitely be renewed. The applicant alleged that he had a further conversation to the same effect with the President in the presence of the then Chief Executive Officer of the second respondent in or around November 2000. 6 There were discussions in January 2002 about the renewal of the applicant's contract. The applicant says in his affidavit that he was told that a new Board of Management which had recently been elected had not had time to consider the renewal of his contract and he was placed on 30 days' notice, which he refused to accept. Sometime in March 2002 the applicant had a disagreement with a resident of the second respondent. Tensions appear to have developed between the applicant and the then President of the second respondent and the applicant was given a letter terminating his employment, but after negotiations his employment was reinstated. 7 In about June 2002 the applicant was provided with a copy of a proposed new service agreement. This contained, relevantly for the purpose of these interlocutory proceedings, similar provisions to the original agreement save that the engagement was said to be terminable by either party giving three months' written notice of termination. It is not clear whether this was intended to be within or outside the two-year term. 8 The applicant wished to obtain independent legal advice concerning the proposed form of agreement. He was referred to Mr Wallach, barrister-at-law, and said in his affidavit that he met with Mr Wallach on 2 September 2002. Mr Wallach advised him that he required "a further 24 week extension past the agreed date of 17 September 2002". This is a date that the applicant had agreed with a member of the Board of Management of the second respondent by which he would obtain independent legal advice. 9 The Chief Executive Officer of the second respondent wrote to the applicant by letter dated 13 September 2002 reminding the applicant that he had agreed to provide a "signed agreement, or comments on the agreement, by no later than Tuesday 17 September 2002. Given the length of time given to you to review the Employment Agreement, I wish to confirm that no further extension to the review period will be granted. As such, I would appreciate you forwarding to me a duly signed copy of the Employment Agreement, or specific details of your comments, if any, with regard to the contents of the Agreement, by no later than Tuesday 17 September 2002". 10 By letter dated 14 September 2002 the applicant responded stating that the signed copy of the Employment Agreement or specific details of his comments would not be available until after 17 September 2002. 11 There followed a series of acrimonious correspondence between the applicant and the President and Chief Executive Office of the second respondent. Included within this correspondence is a letter of 23 September 2002 from the President expressing concern at the failure of the applicant to either sign the Agreement or discuss its terms by the deadline of 17 September 2002, referring to the fact that the applicant had had it in his possession since June 2002. By letter dated the same day the Chief Executive Officer said that the applicant's request for an extension to 18 October 2002 to either sign the Agreement or provide comments was not reasonable but indicated that he would take that request to the Board of Management. 12 By letter dated 1 October 2002 the Chief Executive Officer asserted that the applicant's fixed period of employment had expired in January 2002 and that the Board of Management in a meeting held on 30 September 2002 had declined the applicant's request to review the agreement by 18 October 2002, indicating that the Board would not allow any further period for the review to be undertaken. The letter purported to terminate the applicant's employment forthwith. It referred to other matters which, for present purposes, are not relevant. 13 The applicant annexed to his affidavit a letter which he had received from Mr Wallach dated 29 September 2002 which shows the applicant's address as the applicant's postal address and an email address. The letter commences: "In the limited time available, I have prepared a list of amendments to the proposed Services Agreement. I have set these out in the form of a draft letter to the Board which is attached." The letter then referred to the possibility of amendments after discussion and referred also to changes in the draft letter which had been made after a recent discussion, presumably between the applicant and Mr Wallach. The letter itself contained a brief reference to other matters concerning the applicant's employment, by way of advice. 14 In his affidavit the applicant said that he received this communication from Mr Wallach on 2 October 2002. 15 It is against this factual background that the respondents have sought the production of documents held by Mr Wallach including any documentation referring to advice given by Mr Wallach to the applicant. 16 The proceedings before me were conducted on the basis that firstly the common law test concerning waiver of privilege would be applied and secondly it was to be assumed that the documentation sought to be produced by way of summons attracted legal professional privilege. 17 There was little debate between counsel who appeared for the applicant in support of the motion to strike out the summons for production (Ms E Brus) and counsel who appeared in support of the summons for production (Mr A B Gotting) as to the appropriate principles to be applied. 18 There can be no doubt that there was an express waiver of any privilege attaching to the letter from Mr Wallach to the applicant dated 29 September 2002, because the applicant annexed it to his affidavit. However it is the other documents, the subject of the summons, which is the subject of determination. 19 The legal principles concerning the circumstances in which privilege is deemed to have been waived have been stated authoritatively by appellate courts, in particular by the High Court of Australia. The most recent formulation of the principle is contained within a joint judgment of Gleeson CJ, Gaudron, Gummow and Callinan JJ in Mann v Carnell (1999) 201 CLR 1. I reviewed my understanding of the relevant principles and extracted the relevant portion of that judgment in Tynan Motors Pty Ltd v Mazda Australia Pty Ltd [2003] NSWIRComm 146. I also discussed in that judgment the judgment of the Full Federal Court of Australia in Telstra Corporation Limited v BT Australasia Pty Ltd (1998) 85 FCR 152, the judgment of the Full Court of the Supreme Court of South Australia in Southern Equities Corporation Ltd (in liquidation) v Arthur Anderson and Co (1997) SASC 6373 and the judgment of Allsop J in the Federal Court of Australia in DSE (Holdings) Pty Ltd v Intertan Inc [2003] FCA 384. 20 In Tynan Motors I referred to the fundamental statement of principle contained within the joint judgment of the majority in the High Court of Australia in Mann. I also referred to the majority judgment in the Federal Court of Australia in Telstra Corporation and noted that certain observations within that joint judgment appeared prima facie to contain some inconsistency in approach with the majority judgment in Mann. I concluded that I preferred the statement of principle of Bleby J in the Full Court of the Supreme Court of South Australia in Southern Equities and the analysis of Allsop J in the Federal Court of Australia in DSE (Holdings). 21 I shall not repeat the analysis which I conducted in Tynan. Nothing that was put to me by way of submissions in these proceedings has caused me to seek to vary the conclusions which I reached in those proceedings. 22 I conclude that in order to determine that there has been a waiver of privilege there needs to be demonstrated a relevant nexus between the privileged material and the state of mind of the applicant, and that that state of mind is relevant to an issue or a likely issue in the proceedings. 23 In the circumstances of these proceedings, it is clear that the Board of Management of the second respondent had determined at its meeting on 30 September 2002 to terminate the applicant's employment. So much is clear from the letter dated 1 October 2002 and is irrefutable. Accordingly, whether the advice tendered to the applicant by Mr Wallach was given to him on 29 September 2002 by email (of which there is no evidence), or was received by him as he deposes on 2 October 2002 or, indeed, was given at any earlier stage, cannot be relevant to the decision of the board of management of the second respondent to terminate the applicant's employment taken on 30 September 2002. The only relevance with respect to any such advice is the consequences of its receipt upon the applicant in terms of any action that the applicant might have taken to respond to the request made by the second respondent to either sign the new agreement or make comments about it. 24 At this stage of the proceedings there is simply no evidence or any other material from which an inference might be made that any advice tendered by Mr Wallach could have impacted upon the applicant's state of mind in responding to the Board's ultimatum prior to 30 September 2002. Indeed, the most compelling evidence to date can only be that of the applicant which is to the effect that he was awaiting advice from Mr Wallach before responding. His state of mind is consistent with not having received any such advice. For example, there is no evidence that the applicant made or sought to initiate any approach to either the first or second respondent on 29 September or, indeed, on 30 September seeking that either respondent defer making any decision about the matter. 25 In these circumstances I conclude that there are no grounds upon which it may be inferred or imputed that waiver of legal professional privilege should be ordered. This is not to say that at some later stage in the proceedings circumstances may arise when it might be appropriate to re-examine this matter to determine whether that waiver should apply. 26 The motion should be upheld. The question of costs was not argued before me. In the event that waiver with respect to these documents becomes an issue in the proceedings at some later stage, then on this basis it might be appropriate to reserve costs. In any event I shall reserve costs. ORDERS: 1. The motion is dismissed. 2. Costs are reserved. 3. Liberty to apply with respect to costs. DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated.