Mann v Carnell [1999] HCA 66; 201 CLR 1; 168 ALR 86; 74 ALJR 378

Arnold Mann was for many years a surgeon practising in the Australian Capital Territory. In 1990 and 1991 he commenced legal proceedings against the Australian Capital Territory Board of Health, certain public officials and various medical practitioners for breach of contract, defamation and other causes of action.

As a result of legislation, the Board was abolished, and the Australian Capital Territory was designated to stand in the place of the Board in any unresolved litigation to which the Board was a party.

The litigation finally came on for hearing in September 1997. It was settled on the second day of the hearing when Dr Mann accepted the sum of $400,000 paid into court on behalf of all defendants, without any admission of liability.

On 24 October 1997, Dr Mann wrote a letter to Mr Moore, an Independent member of the Legislative Assembly of the Territory describing what had occurred as a “monumental waste of public funds”.

Anne Katherine Carnell was Chief Minister of the Territory. Moore wrote to her repeating Dr Mann’s description of the events as a “monumental waste of public funds”, seeking from her some assurance that this sort of situation would not occur again.

The Chief Minister replied to Mr Moore in December 1997 as follows:

“I enclose for your information, a letter from the ACT Government Solicitor to the Department of Health and Community Care setting down the particulars of the litigation over the past six years. I also attach copies of briefs received from senior counsel engaged to represent the Territory in the matter.
The settlement of $400,000 was arranged to protect the Territory’s interests by avoiding the costs of a four week hearing and took into account Dr Mann’s ability to pay costs had the Territory been successful in defending the matter.
Please do not hesitate to contact me if you have any further concerns in relation to this matter.”

These documents, when they were originally brought into existence, constituted written communications which were the subject of legal professional privilege.

Dr Mann believed that he had, or may have had, a right to damages against the Chief Minister for defamation, and so sought access to the copies of the documents. The decisive question was whether legal professional privilege subsisted, or had been lost, however the Chief Minister also relied upon public interest immunity to resist their disclosure.

Order 34A of the Supreme Court Rules was headed “Preliminary Discovery”. Rule 5 provided:

“If –
(a) it is reasonable to believe that the applicant has, or may have, the right to obtain relief from a person whose description has been ascertained;
(b) having made reasonable inquiries, the applicant has not gained sufficient information to enable a decision to be made whether to institute a proceeding to obtain the relief;
(c) it is reasonable to believe that the person –
(i) has, or is likely or have; or
(ii) has had, or is likely to have had;
possession of a document relating to the question whether the applicant has the right to obtain the relief; and
(d) inspection of the document by the applicant would assist in making the decision;
the Court may order the person to produce the document to the applicant.”

Rule 2 of O 34A provided:

“An order made under this Order does not operate to require the person against whom the order is made to produce any document that, on the ground of privilege, the person could not be required to produce –
(a) in the case of an order under rule 3 or 5 – if the applicant had commenced a proceeding against the person; or
(b) in the case of an order under subrule 6(1) or (2) – if the applicant had made the person a party to the proceeding.”

s 118 of the Evidence Act provided:

Legal advice
Evidence is not to be adduced if, on objection by a client, the court finds that adducing the evidence would result in disclosure of:
(a) a confidential communication made between the client and a lawyer; or
(b) a confidential communication made between 2 or more lawyers acting for the client; or
(c) the contents of a confidential document (whether delivered or not) prepared by the client, lawyer or another person;
for the dominant purpose of the lawyer, or one or more of the lawyers, providing legal advice to the client.

In Baker v Campbell [1983] HCA 39; (1983) 153 CLR 52 the High Court held that the application of legal professional privilege is not confined to judicial or quasi-judicial proceedings. Deane J said:

“Once one recognizes that the principle underlying legal professional privilege is that a person should be entitled to seek and obtain legal advice without the apprehension of being prejudiced by subsequent disclosure of confidential communications and that the privilege is not confined to such communications as are made in the course of or in anticipation of litigation but extends generally to confidential communications of a professional nature between a person and his lawyer made for the purpose of obtaining or giving legal advice, common sense points to a conclusion that the principle should not be seen as restricted to compulsory disclosure in the course of such proceedings.”

In Thomason v The Council of The Municipality of Campbelltown (1939) 39 SR (NSW) 347 at 355, Jordan CJ said:

“The mere fact that a person on some one occasion chooses to impart to another or others advice which he has received from his solicitor indicates no intention on his part to waive his right to refuse on other occasions to disclose in evidence what that advice was, and supplies no sufficient reason for depriving him of a form of protection which the law has deemed it specially necessary to throw around communications between solicitor and client”.

In Goldberg v Ng Hango Holdings Pty Ltd [1995] HCA 39; (1995) 185 CLR 83, the High Court considered a case of a Sydney solicitor’s delivery of some privileged documents to the Law Society of New South Wales for a limited and specific purpose, and upon terms that the Law Society would treat the information disclosed as confidential. The Court was divided upon whether, in the circumstances of the case, privilege was waived. However, the reasoning of all members of the Court was inconsistent with the proposition that any voluntary disclosure to a third party necessarily waived privilege.

Miles CJ ruled against the respondent’s argument based on legal professional privilege. He did not deal expressly with the subject of public interest immunity, although some of the observations in his reasons for judgment indicate that he would have held against the respondent on that question. Nor did his Honour deal with any discretionary considerations, simply stating, in effect, that, once it was concluded that legal professional privilege did not apply, there was no reason to refuse the order sought by the appellant.

Miles CJ said:

“It is not to be overlooked that a document attracts legal professional privilege because it is a communication ‘made confidentially and passing between client and legal adviser for the purpose of obtaining or giving legal advice or assistance’. The confidentiality is between client and lawyer. That confidentiality is lost if the document is passed on to a third party who has no place in the client-lawyer relationship or the matters in respect of which legal advice or assistance is sought. It is lost whether the document is passed on by the client or by the lawyer, and whatever be the understanding between the third party and the client or lawyer who passes it on about how the document is to be treated. It is the occasion of publication between lawyer and client which confers the privilege, but the privilege does not extend to republication unless republication occurs on a privileged occasion. The distinction between a privileged occasion and a privileged communication is to be recognised.”

The Full Court (Higgins, Lehane and Weinberg JJ) held that legal professional privilege had not been lost and, for that reason, the Chief Minister was protected by the provisions of O 34A r 2. The Full Court indicated that if it had been necessary to decide other discretionary issues they would have been resolved in favour of Dr Mann. In the result, the Full Court ruled that Dr Mann was not entitled to an order that the documents be produced for his inspection. The Full Court found it unnecessary to determine any issue of public interest immunity.

Dr Mann appealed to the High Court.

The majority of the High Court (Gleeson CJ, Gaudron, Gummow and Callinan JJ) made the following general comments about Legal professional privilege based on previous case law:

“At common law, a person who would otherwise be entitled to the benefit of legal professional privilege may waive the privilege. It has been observed that “waiver” is a vague term, used in many senses, and that it often requires further definition according to the context. Legal professional privilege exists to protect the confidentiality of communications between lawyer and client. It is the client who is entitled to the benefit of such confidentiality, and who may relinquish that entitlement. It is inconsistency between the conduct of the client and maintenance of the confidentiality which effects a waiver of the privilege. Examples include disclosure by a client of the client’s version of a communication with a lawyer, which entitles the lawyer to give his or her account of the communication, or the institution of proceedings for professional negligence against a lawyer, in which the lawyer’s evidence as to advice given to the client will be received.
Waiver may be express or implied. Disputes as to implied waiver usually arise from the need to decide whether particular conduct is inconsistent with the maintenance of the confidentiality which the privilege is intended to protect. When an affirmative answer is given to such a question, it is sometimes said that waiver is “imputed by operation of law”. This means that the law recognises the inconsistency and determines its consequences, even though such consequences may not reflect the subjective intention of the party who has lost the privilege. Thus, in Benecke v National Australia Bank, the client was held to have waived privilege by giving evidence, in legal proceedings, concerning her instructions to a barrister in related proceedings, even though she apparently believed she could prevent the barrister from giving the barrister’s version of those instructions. She did not subjectively intend to abandon the privilege. She may not even have turned her mind to the question. However, her intentional act was inconsistent with the maintenance of the confidentiality of the communication. What brings about the waiver is the inconsistency, which the courts, where necessary informed by considerations of fairness, perceive, between the conduct of the client and maintenance of the confidentiality; not some overriding principle of fairness operating at large.”

The majority also said:

“It does less than justice to the respondent’s position to describe what occurred in the present case as disclosure to a third party. The privilege was that of the body politic, the Australian Capital Territory. The head of the Territory’s Executive, the Chief Minister, in response to a question raised by a member of the Territory’s Legislative Assembly as to the reasonableness of the conduct of the Territory in relation to certain litigation, gave the member, confidentially, access to legal advice that had been given to the Territory, and on the basis of which it had acted. Although “disclosure to a third party” may be a convenient rubric under which to discuss many problems of this nature, it represents, at the least, an over-simplification of the circumstances of the present case.”
The purpose of the privilege was to enable the Australian Capital Territory to seek and obtain legal advice, in relation to the litigation which Dr Mann had instituted, without the apprehension of being prejudiced by subsequent disclosure of that advice. That included, and perhaps included above all, subsequent disclosure to Dr Mann. If Mr Moore had been given copies of the legal report and advice given to the Territory in relation to the proceedings brought by the appellant upon the basis that he was at liberty to show them to the appellant, (even if to nobody else), that would have waived the privilege, because it would have been inconsistent with the confidentiality protected by the privilege. It is not difficult to imagine other circumstances in which the basis on which the communications were made available to Mr Moore, even though limited, would have been inconsistent with the purpose of the privilege and thus would have resulted in waiver. Disclosure by a client of confidential legal advice received by the client, which may be for the purpose of explaining or justifying the client’s actions, or for some other purpose, will waive privilege if such disclosure is inconsistent with the confidentiality which the privilege serves to protect. Depending upon the circumstances of the case, considerations of fairness may be relevant to a determination of whether there is such inconsistency. The reasoning of the majority in Goldberg illustrates this.”

The majority concluded:

“The purpose of the privilege being to protect the Territory from subsequent disclosure of the legal advice it received concerning the litigation instituted by the appellant, there was nothing inconsistent with that purpose in the Chief Minister conveying the terms of that advice, on a confidential basis, to a member of the Legislative Assembly who wished to consider the reasonableness of the conduct of the Territory in relation to the litigation.
The conclusion of the Full Court of the Federal Court, that privilege was not lost, was correct.”
The appeal should be dismissed with costs.”

McHugh J dissented:

“The circumstances in which Mr Moore obtained the copied documents from Ms Carnell and the informal arrangement which existed between them as to the confidentiality of those documents indicate that Mr Moore, as a member of the ACT Legislative Assembly, was ensuring that the ACT Executive remained accountable to the Assembly. His letter to Ms Carnell of 31 October 1997 asks: “How can I be assured in such a way that I can feel confident that we will not require an official Inquiry into this matter to ascertain how to avoid this situation arising in the future[?]” Mr Moore was canvassing the possibility of an inquiry, which could presumably be set up by the ACT Legislative Assembly passing appropriate legislation and which would be a means by which the ACT Legislative Assembly could ensure the ACT Executive Government was held to account for its actions taken in relation to the litigation. However, the disclosure to him was relevantly a disclosure to a stranger to a privilege. Mr Moore was not a member of the Executive.
Accordingly, there was disclosure by the owner of the privilege (the ACT Executive) to a person who was a stranger to that privilege. That means that the ACT Executive by sending the copied documents to Mr Moore has waived its privilege in the communication recorded in the original documents. There is no reason for treating the ACT Executive differently from the ordinary citizen in determining whether a voluntary disclosure constitutes a waiver. If the public interest would be advanced by a Minister showing the documents to a member or members of the Assembly, the communication will usually be protected by the public interest immunity doctrine. It may also be proper to extend that immunity to any original documents which are the source of the communication. In a case such as the present, the combination of legal advice to the Executive and inter-governmental communication may itself be enough to give the documents public interest immunity in addition to and independently of the communication of the documents to a member of the Assembly. That being so, there is no need to develop the common law doctrine of waiver of legal professional privilege to accommodate any communication difficulties supposedly confronting the relationship between members of a legislature and members of the executive government. Public interest immunity, not legal professional privilege, is the natural, and best, protector of communications between such parties.”

Kirby J expressed agreement with some of McHugh J’s remarks but ultimately concurred with the majority as to the outcome of the appeal:

“I share McHugh J’s concern that the ambit of legal professional privilege should not be expanded. If this is done, it will result in affording advantages to third parties and strangers who receive the information contained in the privileged communication but for purposes separate from the objects of the privilege. This could, in particular cases, prevent courts from getting at the truth of contested matters and, as a result, deny parties real access to materials necessary for the vindication of their legal rights. As McHugh J points out, this would, in turn, ordinarily act to the advantage of richer litigants (often corporations and government administration) at the expense of poorer opponents (usually individuals). With all of this I am in agreement with McHugh J. Where I part company with McHugh J is that I cannot regard Mr Michael Moore in relation to the client (the Australian Capital Territory) as a third party, still less a stranger. With every respect, I consider that it is unrealistic to attempt to draw an analogy between Mr Moore’s position in relation to the client, the Australian Capital Territory (or even the Executive of that Territory), and a shareholder in a corporation and its board of directors. To attempt such an analogy is to ignore the constitutional and governmental setting in which Mr Moore made his request that led to his limited access to the privileged documents.”