New South Wales Supreme Court CITATION : Dimkovski v Ken's Painting & Decorating Services Pty Limited & 2 ors [2002] NSWSC 50 CURRENT JURISDICTION: Common Law Division FILE NUMBER(S) : SC 20013/98; 20107/00 HEARING DATE(S) : 11 & 12 February 2002 JUDGMENT DATE : 12 February 2002 Acko Dimkovski by his tutor The Protective Commissioner of NSW (Plaintiff) Jordan Trajkovski (Plaintiff) PARTIES : Ken's Painting & Decorating Services Pty Limited (1st Defendant) Lynden Constructions Pty Limited (2nd Defendant) National Hire Pty Limited (3rd Defendant) JUDGMENT OF : Dunford J A Morrison SC / A McSpedden (Plaintiff - Dimkovski) C Evatt / M Rollinson (Plaintiff - Trajkovski) COUNSEL : L King SC / M Jenkins (1st Defendant) R Cavanagh (2nd Defendant) W Fitzsimmons / J Ryan (3rd Defendant) McBride Harle & Martin (Plaintiff - Dimkovski) Carters Law Firm (Plaintiff - Trajkovski) SOLICITORS : William K Chambers (1st Defendant) Henry Davis York (2nd Defendant) Hunt & Hunt (3rd Defendant) CATCHWORDS : EVIDENCE - admissibility - exclusion - client legal privilege - letter from client to insurance broker - not seeking legal advice - Evidence Act 1995, ss 117, 118, 119 - EVIDENCE - admissibility - "confidential document" - "protected document" - Evidence Act 1995, ss 117, 126A - EVIDENCE - discretion to exclude - whether "probative" - opening up of lines of enquiry - Evidence Act s 135, 192, Dictionary (probative) LEGISLATION CITED : Evidence Act 1995, ss 117, 118, 119, 126A, 126B, 135, 192, Dictionary (probative) DECISION : Claims for client privilege and for discretionary exclusion fail. IN THE SUPREME COURT OF NEW SOUTH WALES COMMON LAW DIVISION DUNFORD J Tuesday, 12 FEBRUARY 2002 20013/98 Acko DIMKOVSKI by his tutor THE Protective Commissioner of NSW v Ken's Painting & Decorating Services Pty Limited & 2 ors 20107/00 Jordan TRAJKOVSKI v Ken's Painting & Decorating Services Pty Limited JUDGMENT - Re Claim for Client Legal Privilege; see page 249. 1 HIS HONOUR: Yesterday, when a response was made to the Notice to Produce served by the second defendant on the third defendant, it was indicated there was no objection to producing the documents in paragraphs 1 and 2 of the notice, but there was in respect of paragraphs 3, 4 and 5. 2 I subsequently limited the ambit of the documents required under paragraphs 3 and 4, and that only left outstanding the document specified in paragraph 5, described as "Letter from the managing director of the third defendant, Stephen Donnelly, dated 4 March 1997". In relation to this, the third defendant claimed client legal privilege and relied on the provisions of ss 118 and 119 of the Evidence Act 1995. 3 In order to make sense of what I am about to say, it is necessary to describe the document in general terms. It is a letter from the managing director of the third defendant to its insurance brokers, Alexander & Alexander, dated 4 March 1997 which refers to the scissor lift accident with Lynden Constructions and commences: "I write to inform you of further developments regarding the above accident ...". There follows a narrative of events which makes reference, inter alia, to the fact that McBride Harle & Martin, the solicitors for Mr Dimkovski, requested to inspect the unrepaired scissors lift, and it also refers to certain testing of the machine by Work Cover New South Wales, although the references to these two items appear purely incidental to the general narrative of facts which were recited and unrelated to the main content thereof. The letter concludes: "In light of the above information, would you please advise as to what action we should take." 4 So far as presently material, s 118 protects against disclosure the contents of a confidential document (whether delivered or not) prepared by the client or a lawyer for the dominant purpose of the lawyer providing legal advice to the client. 5 This letter was not prepared by a lawyer, but by the client, and two questions arise: firstly, whether it was a confidential document; and secondly, whether it was prepared for the dominant purpose of a lawyer providing legal advice to the third defendant. 6 "Confidential document" is defined in s 117 to mean "a document prepared in such circumstances that, when it was prepared: (a) the person who prepared it, or (b) the person for whom it was prepared, was under an express or implied obligation not to disclose its contents, whether or not the obligation arises under law." 7 In the present case, neither the person who prepared the document, the third defendant, nor the person to whom it was addressed, the insurance brokers, was under any express or implied obligation not to disclose its contents. Clearly the third defendant was at liberty to disclose its contents to any number of people if it wished, including Snorkel Elevating Work Platforms Pty Limited and/or a technical engineering or mechanical consultant, and although it may have had no reason to disclose its contents to anyone else, there would appear to be no obligation on it not to do so and no evidence was adduced in an effort to establish such an obligation. 8 Similarly, Alexander & Alexander, the insurance brokers, were not subject to any obligation not to disclose it. In particular, one can expect that they might disclose it to the third defendant's insurance company, possibly to a reinsurer and/or to the insurance company's lawyers. I am therefore satisfied that it was not a confidential document. 9 The fact that it may have been disclosed by the addressee to the third defendant's insurance company and its lawyer does not, however, mean that it was prepared for the dominant purpose of the lawyer providing legal advice to the third defendant. 10 In its context, I am satisfied that for the section to operate there must be a relationship between the client and the lawyer or, to put it another way, the lawyer must be the lawyer of the client. If the addressee, in this case the insurance broker, were to direct the letter to a lawyer for him or her to provide legal advice, it would be for the purpose of the addressee's lawyer or the insurance company's lawyer providing legal advice to the addressee or to the insurance company, not to the third defendant, even though such legal advice may subsequently be communicated to the third defendant. 11 In any event, I am not satisfied that the dominant, or any purpose, of the letter was to obtain legal advice from a lawyer. It is quite possible that at that early stage of the matter, the broker or the insurance company may give advice or direction to the third defendant based on their own knowledge, practice, and/or experience, without consulting a lawyer. 12 The third defendant's letter was not directed to a lawyer and it did not seek legal advice and, therefore, I am satisfied that it is not the subject of client legal privilege pursuant to s 118. 13 In relation to s 119, which provides for client privilege in respect of the contents of a confidential document (whether delivered or not) that was prepared for the dominant purpose of the client being provided with professional legal services relating to proceedings, or anticipated proceedings in which the client is or may be a party, I am satisfied for the reasons already given that it was not a confidential document. 14 I am satisfied, particularly because of the reference in the letter to the plaintiff's solicitors inspecting the machine, that litigation was anticipated; but once again, there is no evidence that the letter was written for the dominant purpose of the client, that is, the third defendant, being provided with professional legal services in such proceedings. The letter simply asked the brokers for advice or direction on how to proceed. There is no evidence that professional legal services were sought or required, or intended to be sought at that stage, and the letter was not written by the third defendant for that purpose. 15 Accordingly, the document is not the subject of client legal privilege under s 119 and the third defendant's objection to production of the document (Exhibit Z1 on the voir dire) fails. (Mr Fitzsimmons then made application for evidence of the document to be excluded as a "protected confidence" pursuant to s 126B of the Act – discussion ensued.) 16 HIS HONOUR: It is noted that the third defendant seeks an order that the evidence be excluded pursuant to s 126B as a protected confidence, but in light of my earlier ruling concedes that he would have difficulty establishing that the letter constituted a "protected confidence" within the meaning of s 126A(1). It makes no further submissions, but wishes to reserve its rights. (Mr Fitzsimmons then made application for evidence of the document to be excluded pursuant to s 135 of the Act – discussion ensued.) 17 HIS HONOUR: Mr Fitzsimmons alternatively seeks an order that evidence of the letter, Exhibit Z1 on the voir dire, be excluded pursuant to the discretion I have under s 135 of the Evidence Act on the ground that its probative value is substantially outweighed by the danger that it might be unfairly prejudicial to his client. 18 He draws my attention to the meaning of "probative value" in the Dictionary to the Act as "the extent to which the evidence could rationally affect the assessment of the possibility of the existence of a fact in issue" and submits that the probative value of the document on its face is minimal, and that there is a danger that the evidence might be unfairly prejudicial to his client. 19 The difficulty I have with this submission - and it is somewhat difficult to express it without referring in detail to the contents of the letter - is such that although the mere tender of the letter may be of minimal probative value, access to the letter may open up other lines of enquiry or provide material for cross-examination which could be of significant probative value, particularly, it seems to me, on one of the issues that are relevant to the establishment of the tort of negligence, namely, the availability of a practical alternative. 20 Furthermore, this is not a case where there is a jury and I would hope that I can weigh the evidence fairly, without being swayed by irrelevant considerations which might be unfairly prejudicial. 21 I have also had regard to all the matters referred to in s 192 of the Act. In particular, the admission of the document may add to the length of the hearing, but I do not consider it would unduly add to it because evidence of the matters referred to in the letter could be important. 22 For these reasons I decline to exercise my discretion to exclude the contents of the letter pursuant to s 135. oOo Last Modified: 02/26/2002 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.