Paradise Lost – The High Court considers the scope of legal professional privilege in Glencore International AG v Commissioner of Taxation [2019] HCA 26

In the recently published decision in Glencore, the High Court considered the question of whether the law of legal professional privilege (LPP) operates only as a defensive mechanism to resist compulsory production of documents (ie: a shield), or if it also operates to provide a positive right which entitles the holder of the privilege to a remedy eg:  an injunction to restrain the use of the privileged documents (ie:  a sword).

The Court unanimously determined LPP is not a legal right enforceable by injunction when confidential documents have entered the public domain, even as a result of theft. The Court confirmed LPP remains a fundamental right.  However, LPP only operates as an immunity from complying with compulsory processes which would otherwise require the production of confidential and privileged documents.

Throughout the decision, the Court highlighted the importance of LPP. It said, while there is no dispute the Glencore documents were the subject of LPP, that privilege did not amount to a cause of action which could be enforced by injunctive relief.  The Court confirmed at [12] that LPP “is only an immunity from the exercise of powers which would otherwise compel the disclosure of privileged communications.”

The Court found against Glencore at [13] on the basis “It seeks to transform the nature of the privilege form an immunity into an ill-defined cause of action which may be brought against anyone with respect to documents which may be in the public domain …”

Notably, Glencore made no claim to recover its documents based on equitable principles concerning breach of confidence. Glencore likely recognised that due to the wording of Section 166 of the Income Tax Assessment Act 1936 (Cth) (ITA Act), such an action would likely fail.

The Court rejected Glencore’s application for an injunction and delivery up on the basis it was based on an incorrect premise ie: that LPP is a legal right capable of being enforced.  The Court held LPP is only an immunity from the exercise of powers which would otherwise compel the disclosure of privileged communications.  The Court found it was not possible to discern from the cases that LPP, while being a fundamental common law right, was an actionable right.  LPP is a right to resist compulsory production or disclosure of confidential information.

The rationale for LPP is that the rule promotes the public interest because it assists and enhances the administration of justice by facilitating the representation of clients by lawyers. Public interest in LPP prevails over other matters of public interest eg:  the fair conduct of litigation with the benefit of all relevant documents being available.  The Court found the public interest behind LPP is sufficiently secured through its operation as an immunity.

Dr Richard Manly QC

MTECC Welcomes Angelo Germano
Angelo Germano, who is presently reading with Katie Stynes, has joined MTECC. Angelo has previously worked as a solicitor at Kalus Kenny Intelex and McKean Park with a particular focus on technology, engineering and construction matters, as well as in-house counsel for Mercedes-Benz in Rome.
Angelo’s Vicbar profile can be found here, and we hope to upload his MTECC profile to the website shortly.

Congratulations to Michael Whitten QC on his appointment
Michael Whitten QC, the chair of MTECC, has been appointed as the next Lord Chief Justice of the Kingdom of Tonga, commencing on 1 September 2019. MTECC congratulates Michael on his appointment and wishes him and his family all the best in his new endeavour.

MTECC members presenting ICU Legal Seminars in September and November 2019
A number of MTECC members are presenting at ICU Legal Seminars on 20 September and 22 November 2019:
• Jim Stavris is presenting on “Recent cases on the Building and Construction Industry Security of Payment Act 2002” on 20 September 2019;
• Nicholas Gallina is presenting on “Rectification of Construction Contracts” on 20 September 2019; and
• Michael Sharkey is presenting on “Ethical Issues in Engaging Expert Witnesses” on 22 November 2019.
More information can be found here and here.