Federal Court of Australia

Roberts-Smith v Fairfax Media Publications Pty Limited (No 23) [2021] FCA 1460

ORDERS

THE COURT ORDERS THAT:

1.    The respondents’ interlocutory application, dated 20 August 2021, is dismissed.

Note:    Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

REASONS FOR JUDGMENT

ABRAHAM J:

1    Mr Ben Roberts-Smith VC MG is a former soldier who was deployed on multiple occasions to Afghanistan. In August 2018, Mr Roberts-Smith commenced proceedings in this Court seeking damages for alleged defamatory publications by Fairfax Media Publications Pty Ltd (Fairfax), The Age Company Pty Ltd, The Federal Capital Press of Australia Pty Ltd and certain journalists. The publications are alleged to have carried a number of imputations concerning the conduct of Mr Roberts-Smith whilst serving in Afghanistan. The alleged imputations include that Mr Roberts-Smith broke the moral and legal rules of military engagement and that he is therefore a criminal. By their defence, the respondents claim to be able to justify the imputations, a matter on which they bear the onus of proof. The substantive hearing commenced on 7 June 2021, and the applicant’s case in chief has closed. The hearing has been adjourned as a result of difficulties which have arisen as a consequence of Covid-19 restrictions.

2    On 5 March 2020, at the respondents’ request, the Court sealed a subpoena addressed to Cato & Clive Partners Pty Ltd (Cato & Clive), a public relations firm (Cato subpoena). On or about 27 April 2020, Cato & Clive produced two packets of documents to the Court in response. On 29 April 2020, at the respondents’ request, the Court sealed a subpoena addressed to Ross Coulthart (Coulthart subpoena). In early June 2020, Mr Coulthart produced three packets of documents to the Court in response.

3    The applicant notified the Court of his claim for legal professional privilege to the Cato subpoena on 4 May 2020, and to the Coulthart subpoena on 16 June 2020.

4    On 23 August 2021, over twelve months after those claims were notified, the respondents filed an interlocutory application challenging the claims for privilege over those documents.

5    The applicant maintains his objection to the inspection of certain documents produced by Cato & Clive and Mr Coulthart, on the basis that those documents are covered by legal professional privilege, only four of which are now challenged by the respondents. In summary, Document 1 is a report prepared by Mr Coulthart who at the time was employed by Cato & Clegg (now Cato & Clive) on 22 June 2018 (Report). Documents 2 to 4 are emails attaching draft media statements which Mr Coulthart sent for comment to the applicant’s lawyers and third parties in the period of August to November 2018.

6    This judgment relates to the determination of those claims.

7    For the reasons below, the applicant’s claim for legal professional privilege over the documents sought is upheld.

Material relied on by the applicant

8    The applicant read a number of affidavits and tendered a bundle of documents.

Bruce McWilliam

9    An affidavit of Bruce McWilliam, dated 21 September 2021, was read. Mr McWilliam is General Counsel and Commercial Director of Seven West Media Ltd (SWM) and has been employed with SWM (via its subsidiary Seven Network (Operations) Ltd) or its predecessor corporation, Seven Network Ltd, since July 2003. Mr McWilliam holds a current practising certificate in New South Wales. He became aware in or about mid-2017, that the applicant had been contacted by Chris Masters, one of the respondents in the substantive proceedings, in connection with the writing and research of Mr Masters’ book ‘No Front Line’. The applicant informed Mr McWilliam that Mr Masters had alleged he had unlawfully killed persons in Afghanistan and possibly committed other war crimes, and that the allegations were false. Mr McWilliam suggested to the applicant that he retain Mark O’Brien, a solicitor specialising in defamation, to act on his behalf to protect his reputation in the face of false allegations he thought were being made against him. He said that he was concerned that the applicant’s employment by, or association with, SWM, may have been a contributing reason as to why he was being targeted by Mr Masters. He was of the view SWM had a duty of care to the applicant.

10    Invoices from Mark O’Brien Legal (MOBL) for legal services provided to the applicant were initially paid for by SWM but later, as they mounted up, a separate account was established to distinguish them from SWM expenses. A formal loan agreement was then documented in or about August 2019.

11    On 19 October 2017, the Sydney Morning Herald (SMH) published a story written by Nick McKenzie which inter alia, suggested that “well-placed sources” said it was likely that the inquiry being conducted by Major General the Honourable Paul Brereton AM RFD, a judge of the New South Wales Court of Appeal (the Inquiry), would wish to interview the applicant regarding the complaint and accusations.

12    On 8 June 2018, the SMH published a story written by Mr McKenzie and Mr Masters titled ‘SAS soldier accused of killing innocent villager’. Mr McWilliam said that:

The article alleged that a soldier nicknamed “Leonidas” was involved in the unlawful killing of an innocent villager in Afghanistan. The article suggested there were “first hand witnesses” and asserted that this incident was being investigated by the Inquiry. Upon reading this article, I formed the view that the article may have been referring to the Applicant as a continuation of the matters published about him in 2017 (as referred to in the article in paragraph 5 above) and that there was a real possibility that the Applicant would be required to appear before the Inquiry. As the Applicant denied the allegation, I wanted to ensure that the Applicant received legal advice that was properly informed in relation to the allegations against him as they might become the subject of an attendance by the Applicant before the Inquiry and might also become the subject of a potential claim for defamation. I also wanted to ensure that SWM could obtain advice about the allegations so it could form its own view about them as it was funding the Applicant’s legal bills at that time and employed him in a senior executive position and would face scrutiny over any controversial matters relating to a senior employee.

13    Mr McWilliam deposes to the following conversation he had with the applicant shortly after the article was published:

[Mr McWilliam]:    Ben, I think there may be some prospect that you will be called to give evidence to the Brereton Inquiry. You will need to be prepared and understand your rights and obligations. I also think that you may need to consider your position regarding defamation insofar as false accusations are being made against you. If you agree, I propose to ask Ross Coulthart to prepare a report examining the various rumours and allegations about you and your response to them and to investigate and check them out independently to the extent he can. Ross is a lawyer by training and he worked for us as an investigative reporter on Sunday Night. He has an interest in military stories. He has an inquiring mind and will be relentless in investigating the allegations. I think this will be a good starting point for Arthur and Mark. It will also be useful for SWM as we will likely also be attacked for continuing to employ you. I think it is vital that the report be prepared with the protection of legal professional privilege. I would like to see a copy of it as I would like to be able to say that I am across the issues in case I am asked any questions by the Chairman, board members or other executives. I also think a copy should be provided to the Chairman so that he is in a position to obtain can get legal advice on where things stand and so that he can continue to back you.

[Applicant]:    I am fine with this approach but the matters that Ross is likely to cover are highly sensitive and classified. I will disclose as much as I am able to. I agree it would be useful for my lawyers to have something like this so that we know what we are dealing with in case I have to give evidence to the Inquiry. I do not have a problem with you and the Chairman having access to it in case the Chairman needs advice to be comfortable backing me or you are asked questions. I will wait to hear from Ross.

14    Mr McWilliam then had a conversation with Mr Coulthart, as follows:

[Mr McWilliam]:    Ross, can you prepare a report which considers and summarises all of the known rumours and allegations that are circulating or have been published about Ben Roberts-Smith and get his response to each of them as well as conduct investigations and make any other enquiries you see fit. You are an experienced investigator and know what to do so I will leave it to you as to how you go about checking this out. I want the report to be addressed to Justine Munsie who advises SWM from time to time and Arthur Moses SC an expert on military law who is advising Ben for legal professional privilege reasons but do not send it to them as I will arrange for it to be sent to them. Please give me the report when it is completed and I will distribute it. The contents of the report are sensitive and it should be marked as confidential and privileged.

[Mr Coulthart]:        Yes, no problem.

15    Mr McWilliam deposes that he was of the opinion that Mr Coulthart’s Report, by setting out the various known allegations against the applicant and his responses to them, would assist the applicant’s lawyers to advise him in relation to any possible attendance at the Inquiry and also in relation to a potential claim for defamation. If the applicant were required to attend the Inquiry, he understood that the applicant’s lawyers would advise him about what he should do and prepare him for that process. At the time Mr McWilliam spoke to Mr Coulthart, he considered that a copy of the Report may need to be provided to Justine Munsie in case she needed to provide any advice to Kerry Stokes, the Chairman of SWM (although Mr McWilliam later decided that advice was not required). That is why Mr McWilliam told Mr Coulthart to address the Report to Ms Munsie as well as Mr Moses SC. Mr McWilliam said he knew that Mr Moses SC was the senior counsel advising the applicant in relation to military matters. He did not consider there to be any conflict between SWM’s position and the applicant’s position. At this time, SWM was providing financial support to the applicant and Mr McWilliam thought it was important that both he and the Chairman receive a copy of the Report because he wanted to ensure that any decision by SWM to continue to support the applicant was a “considered one” and so that he and the Chairman could obtain external legal advice for SWM if they thought that would be required.

16    Mr McWilliam said that after he received a copy of the Report, he made copies and distributed them to Mr Stokes and Mr O’Brien (for Mr O’Brien to provide to Mr Moses SC). Ms Munsie was not given a copy of the Report as Mr McWilliam had decided she did not need to be retained to advise Mr Stokes at that stage but that he would provide any advice to Mr Stokes if he thought it necessary. Mr McWilliam said he did not give anyone else a copy of the Report and has not disclosed the contents of the Report to anyone other than those referred to above. On 20 September 2021, the Chairman said to him words to the effect of: “I have not provided a copy of Mr Coulthart’s report or spoken about its contents to anyone other than you, Mr Coulthart and Mr Moses”.

James Ross Coulthart

17    An affidavit of James Ross Coulthart, dated 21 September 2021, was read. Mr Coulthart is a freelance investigative journalist and writer, who at the relevant time was employed by Cato & Clegg. Mr Coulthart details the request made to him by Mr McWilliam on 8 June 2018 (which is in similar terms to the discussion which Mr McWilliam deposes to above at [14]), and a conversation which he subsequently had with the applicant in relation to arranging a meeting to discuss the “allegations and rumours” for the purposes of preparing his Report. Approximately one week later, Mr Coulthart went to Queensland to meet with the applicant at his home to discuss the allegations and obtain his response.

18    Mr Coulthart completed the Report on 22 June 2018. He provided a hard copy of the Report to Mr McWilliam on that same day, and says he did not give any other person a copy in accordance with Mr McWilliam’s instructions, and has not disclosed the contents of the Report to anyone except Mr McWilliam and Mr Stokes.

19    After preparing the Report in June 2018, Mr Coulthart assisted the applicant from time to time to prepare media statements.

20    In respect to the media statements the subject of this application, given the proceedings are before the Court, it was Mr Coulthart’s practice to prepare a first draft which he then would send to the applicant’s legal advisers for review and comment. Although the final version of any statement was public, it was his practice to treat draft statements and any communications about draft statements as confidential.

21    Mr Coulthart details sending four emails (only three of which are the subject of this application) attaching draft media statements to the applicant’s lawyers, as well as others, including from SWM, and in each instance he said his purpose was to obtain legal advice on the contents of the statements. The emails (described below) were treated as confidential and Mr Coulthart has not disclosed their contents to anyone other than the recipients.

22    On 10 August 2018, Mr Coulthart sent an email attaching a draft media statement to the applicant, Mr Stokes, Mr McWilliam, Mr O’Brien and Mr Moses SC. The main reason he sent this email was to enable the applicant’s lawyers to provide legal advice on the draft statement, however, Mr Coulthart also intended that Mr Stokes and Mr McWilliam be provided with a copy so that they could review and comment on it as well.

23    On 14 October 2018, Mr Coulthart sent an email attaching a draft media statement to the applicant, Mr O’Brien, Mr Stokes, Mr McWilliam and Tim Allerton, a public relations adviser. The main reason he sent this email was to enable the applicant’s lawyers to provide legal advice on the draft statement, however, Mr Coulthart also intended that Mr Stokes, Mr McWilliam and Mr Allerton be provided with a copy so that they could review and comment on it as well.

24    On 23 November 2018, Mr Coulthart sent an email attaching a draft media statement to the applicant, Mr O’Brien and Sue Cato, a principal from Cato & Clegg. The main reason he sent this email was to enable the applicant’s lawyers to provide legal advice on the draft statement. Later that day, Mr O’Brien responded to this email. He treated the response as confidential.

Ben Roberts-Smith

25    An affidavit of Ben Roberts-Smith, dated 21 September 2021, was read. He describes the circumstances in which he came to retain Mr O’Brien as his solicitor. He details a conversation he had in early June 2018 when Mr McWilliam telephoned him as follows:

[Mr McWilliam]:     Ben, based on the reporting, it sounds like you may be called to give evidence to the Brereton Inquiry. I think we should get Ross Coulthart to investigate the various rumours and allegations about you and to note your response to them. I think this will be a good starting point for Arthur and Mark to prepare you for the Inquiry. I trust Ross. He has worked with us for a number of years, he has a legal background and he is an excellent investigative journalist. I also think a copy should go to the Chairman too.

[Applicant]:    Happy to, Bruce. Today's story is rubbish but whatever you think will help. What happened on my missions is sensitive but I will I will [sic] wait to hear from Ross and arrange a time to sit down with him.

26    Mr Roberts-Smith details a conversation with Mr Coulthart which occurred thereafter, and the fact he met with him.

27    Mr Roberts-Smith deposes at [9] that:

I believed that my discussions with Mr Coulthart and the document he prepared following those discussions would be provided to my lawyers, Mr Moses SC and Mr O'Brien to assist them in providing me with advice and to prepare me to give evidence to the Inquiry. I also understood that a copy would be provided to Mr Stokes and Mr McWilliam….

28    He said he has not received a copy of Mr Coulthart’s Report but he has been informed by Mr O’Brien that Mr O’Brien provided a copy to Mr Moses SC.

29    Mr Roberts-Smith annexed to his affidavit copies of loan agreements which he entered into with Seven West (Operations) Ltd and Australian Capital Equity in connection with the financing of his legal fees, dated 6 August 2019 and 24 June 2020 respectively.

Mark Geoffrey O’Brien

30    An affidavit of Mark Geoffrey O’Brien, dated 21 September 2021, was read. He is a principal of the firm MOBL, the solicitors for the applicant in this proceeding, and the supervising partner.

31    Mr O’Brien details being aware of a series of articles in relation to the applicant, which were published by the respondents on 8, 9 and 10 June 2018. He details that after the publication of the matters complained of, he received a telephone call from Mr McWilliam, during which there was the following conversation:

[Mr McWilliam]:    I have asked Ross Coulthart to prepare a report which summarises all the rumours and allegations about Ben and get his response to them. I thought it would assist you and Arthur to advise Ben and prepare him for any interview by Justice Brereton. Ross knows its sensitive and I have asked him to keep his work confidential and make sure the report is marked as privileged. I have asked Ross to give it to me when he completes it and I will give it to you. I will also give a copy to Kerry as well. Kerry and I have been supportive of Ben and I think we should see the report too so that we have a basis for continuing our support of him.

[Mr O’Brien]:    I think that would be a very useful document for Arthur and I to have. If the reporting is correct, Ben may be summoned to appear in the near future.

32    On or about 22 June 2018, he received a hard copy of the Report from Mr McWilliam. Shortly after receiving the Report, he provided a hard copy of the Report to Mr Moses SC, who he had briefed to advise and appear on the applicant’s behalf before the Inquiry. He has not disclosed the contents of the Report to anyone outside the applicant’s legal team for the Inquiry.

33    Mr O’Brien said that from time-to-time Mr Coulthart has assisted the applicant to prepare media statements. Mr Coulthart circulates the draft statements via email to him and other lawyers for review and legal advice. He received Mr Coulthart’s emails attaching draft statements on the basis that they were confidential and not to be distributed to anyone other than the persons copied to them for the purpose of obtaining legal advice. He detailed receiving the three emails in question, and in respect to one of those emails, legal advice was given on behalf of the applicant, including amendments to a proposed statement. I note that Mr O’Brien also provided detail in respect to Documents 5-8, over which privilege is claimed. Those claims are not now challenged.

Justine Munsie

34    An affidavit of Justine Munsie, dated 21 September 2021, was read. Ms Munsie is a partner at Addisons, a law firm. Although the Report was addressed to Ms Munsie, Ms Munsie does not know why the Report was addressed to her and she does not recall ever receiving or seeing a copy of the Report.

Material relied on by the respondents

35    The respondents relied on two affidavits and also tendered a bundle of documents.

Peter Llewellyn Bartlett

36    The respondents read the affidavits of Peter Llewellyn Bartlett, dated 20 August 2021 and 23 September 2021. Mr Bartlett is a partner of MinterEllison and the lawyer for the respondents in these proceedings. Mr Bartlett annexes to his first affidavit a copy of the relevant subpoenas and correspondence between his firm and the applicant’s solicitors in respect to each of the two subpoenas. Mr Bartlett’s second affidavit primarily addressed the context in which it was said that Mr Coulthart’s investigation leading to the preparation of his report took place. These events are unnecessary to detail here, and are referred to below at [69]-[72]. Suffice to say they include, inter alia, various communications between relevant persons, when certain persons gave evidence to the Inquiry and communications between the applicant and persons who had attended the Inquiry.

Legal principles

37    As the applicant’s claim for privilege is made in respect to the inspection of documents sought by subpoena it is governed by the common law and not the Evidence Act 1995 (Cth): Esso Australia Resources Ltd v Federal Commissioner of Taxation [1999] HCA 67; (1999) 201 CLR 49 (Esso) at [16]-[17]; Australian Securities and Investments Commission v Australian Lending Centre Pty Ltd (No 2) [2011] FCA 1057; (2011) 283 ALR 299 at [6]-[9]; DBCT Management Pty Ltd v McConnell Dowell Constructors (Aust) Pty Ltd and Geosea Australia Pty Ltd Joint Venture [2021] FCA 512 at [74].

38    Legal professional privilege protects a person from being compelled to produce documents or give information which would reveal communications between a client and his or her lawyer, made for the dominant purpose of obtaining or providing legal advice, or the provision of legal services, including representation in pending or anticipated legal proceedings: Esso at [35], [61]; Daniels Corporation International Pty Ltd v Australian Competition and Consumer Commission [2002] HCA 49; (2002) 213 CLR 543 at [9].

39    The dominant purpose is the “ruling, prevailing or most influential purpose”: Federal Commissioner of Taxation v Spotless Services Ltd [1996] HCA 34; (1996) 186 CLR 404 at 416. It is a purpose that predominates over other purposes; the prevailing or paramount purpose: AWB Ltd v Cole [2006] FCA 571; (2006) 152 FCR 382 (AWB) at [105]-[106]. The “dominant purpose” brings within the scope of the privilege a document brought into existence for the purpose of a client being provided with professional legal services notwithstanding that some ancillary or subsidiary use of the document was contemplated at the time: Esso at [58]. The purpose for which a document is brought into existence is a question of fact that must be determined objectively, having regard to the evidence, the nature of the document and the parties’ submissions: AWB at [109]-[110].

40    An appropriate starting point when applying the dominant purpose test is to ask what was the intended use or uses of the document which accounted for it being brought into existence: Pratt Holdings Pty Ltd v Commissioner of Taxation [2004] FCAFC 122; (2004) 136 FCR 357 (Pratt 2004) at [35]. Attention is focused on the purpose (or purposes) of the person who created the document, or who, if not its author, had the authority to, and did, procure its creation: Pratt 2004 at [35]. Where the person who procured the creation of the document is not its author (such as a solicitor commissioning a report), the intention of that person, not the author’s, is relevant: Hartogen Energy Ltd (in liq) v Australian Gas Light Co [1992] FCA 322; (1992) 36 FCR 557 (Hartogen Energy) at 568-9. Although as noted above, the existence of an ancillary purpose is not fatal to a privilege claim, if there are two purposes of equal weight, neither is dominant: Commissioner of Taxation v Pratt Holdings Pty Ltd [2005] FCA 1247 (Pratt 2005) at [30(8)]; Re Southland Coal Pty Ltd (rec & mgrs apptd) (in liq) [2006] NSWCA 899 at [14(h)].

41    The party claiming privilege bears the onus of proving the facts necessary to establish the relevant privilege, including that the communications or documents in question were made or created for the required dominant purpose: Grant v Downs [1976] HCA 73; (1976) 135 CLR 674 (Grant v Downs) at 689.

42    The concept of legal advice in the context of advice privilege is fairly broad. It goes beyond formal advice as to the law, and extends to professional advice as to what a party should prudently or sensibly do in a relevant legal context, but does not extend to advice that is purely factual or commercial: Balabel v Air India [1988] Ch 317 (Balabel) at 323, 330; DSE (Holdings) Pty Ltd v InterTAN Inc [2003] FCA 1191; (2003) 135 FCR 151 at [45]; AWB at [100]; BWO19 v Minister for Immigration, Citizenship, Migrant Services and Multicultural Affairs [2020] FCAFC 181 at [62]. Legal advice includes professional advice given by lawyers to a client as to what evidence and submissions should be placed before a commission of inquiry: AWB at [100]; Three Rivers District Council v Governor and Company of the Bank of England (No 6) [2004] UKHL 48; [2005] 1 AC 610 at 651-653, 681-683.

43    Litigation privilege attaches to confidential communications passing between a client and the client’s lawyer or a third party, or the client’s lawyer and a third party, where the communication was made for the dominant purpose of use in, or in relation to, existing or reasonably anticipated litigation: Mitsubishi Electric Australia Pty Ltd v Victorian WorkCover Authority [2002] VSCA 59; (2002) 4 VR 332 (Mitsubishi) at [8]; Commissioner of Taxation v Pratt Holdings Pty Ltd [2003] FCA 6; (2003) 195 ALR 717 (Pratt 2003) at [39]; AWB at [144]. The key difference between advice privilege and litigation privilege is that litigation privilege is not limited to communications whose dominant purpose is the giving or obtaining of legal advice: AWB at [145].

44    Whether or not litigation is reasonably contemplated is a question of fact to be determined objectively: Grant v Downs at 682; Nickmar Pty Ltd v Preservatrice Skandia Insurance Ltd (1985) 3 NSWLR 44 at 55. The subjective views of the parties are relevant but not determinative and the question must be assessed by reference to all of the surrounding circumstances: Ensham Resources Pty Ltd v AIOI Insurance Company Ltd [2012] FCAFC 191; (2012) 209 FCR 1 (Ensham) at [53]. The relevant test is that “there must be a real prospect of litigation, as distinct from a mere possibility, but it does not have to be more likely than not”: Mitsubishi at [19]; Ensham at [55]-[57]. Whether or not litigation is reasonably contemplated is usually determined at the time the document is brought into existence, but in cases where a solicitor may have commissioned the preparation of a report, the relevant time may be when the report was commissioned: Singapore Airlines v Sydney Airports Corporation [2004] NSWSC 380 at [19]-[21].

45    Also relevant to the consideration of the determination of the issues in this matter, is common interest privilege, which is discussed below.

46    The Court has the power to examine documents in respect of which a privilege claim is made: Grant v Downs at 689. The essential purpose of inspecting the documents is “to determine whether, on its face, the nature and content of the document supports the claim for legal professional privilege”: AWB Ltd v Cole (No 5) [2006] FCA 1234; (2006) 155 FCR 30 (AWB (No 5)) at [44(12)]. “[I]n many instances the character of documents the subject of the claim will illuminate the purpose for which they were brought into existence”: Grant v Downs at 689. A party is not entitled to insist on the court inspecting the documents, it being a matter for the discretion of the judge, who will only do so if there is good reason: Hancock v Rinehart (Privilege) [2016] NSWSC 12 at [31], citing Westminster Airways Ltd v Kuwait Oil Co Ltd [1951] 1 KB 134 at 146; District Council of Mallala v Livestock Markets Ltd [2006] SASC 80; (2006) 94 SASR 258 at [30]; Woollahra Municipal Council v Westpac Banking Corporation (1994) 33 NSWLR 529 at 542.

Document 1

Submissions

47    As noted above, Document 1 is a report prepared by Mr Coulthart (who at the time was employed by public relations firm Cato & Clegg, now Cato & Clive). The applicant claims privilege on two bases: first, it was created for the dominant purpose of obtaining legal advice; and second, it was created for the dominant purpose of being put before the applicant’s solicitor with the object of obtaining his advice and to prosecute a potential defamation action.

48    The applicant outlined the evidence and context in which the document was created. This submission is referred to in more detail below.

49    It was submitted that after the SMH article was published on 8 June 2018, Document 1 was prepared by Mr Coulthart at the request of Mr McWilliam on behalf of the applicant and SWM. It was submitted that Mr McWilliam apprehended that the applicant may be required to appear before the Inquiry. After obtaining the applicant’s consent, Mr McWilliam asked Mr Coulthart to investigate the rumours circulating about the applicant and to obtain the applicant’s response. Mr McWilliam’s purpose in commissioning the Report was to ensure that the applicant received informed legal advice in relation to a potential attendance at the Inquiry and also in relation to a potential claim for defamation. The applicant’s purpose in agreeing to Mr Coulthart preparing the Report was to facilitate the receipt of advice about how to prepare to give evidence to the Inquiry.

50    It was submitted that the dominant purpose of the document was to inform the applicant of the various allegations reviewed by Mr Coulthart and enable him to provide instructions in relation to the allegations so that his lawyers, with all of the material in one place, could advise the applicant in relation to a possible attendance at the Inquiry and possible defamation proceedings. The advice being sought from the applicant’s lawyers was advice “as to what should prudently and sensibly be done in the relevant legal context”, citing Balabel at 330. It was submitted that a subsidiary purpose was to enable SWM to obtain advice from an external lawyer (Ms Munsie) if Mr McWilliam determined it was necessary to do so given that SWM was funding the applicant’s legal fees.

51    It was submitted that the document would not have come into existence but for the purpose of enabling the applicant to obtain advice from his lawyers, including in relation to the Inquiry and possible defamation proceedings in order to protect his reputation and his interests. The fact that that had the benefit of protecting the interests of SWM is a secondary purpose and subsidiary to that dominant purpose.

52    It was submitted that privilege was not waived when a copy of the Report was provided to Mr McWilliam and Mr Stokes. The document was received by them (on behalf of SWM) in confidence for the purpose explained by Mr McWilliam and with the applicant’s consent. SWM, with the backing of Mr Stokes, was providing legal funding to the applicant and the Report enabled those financially assisting him to be kept abreast of the allegations (then known) and the applicant’s response to them and possibly to receive legal advice. Mr McWilliam contemplated prior to receiving the Report that external advice may have been necessary so that SWM could form its own view about the allegations but no such advice was obtained. It was submitted that a sufficient commonality of interest existed in the document such that its disclosure to Mr Stokes and Mr McWilliam on behalf of SWM did not effect a blanket waiver of privilege or was inconsistent with an ongoing intention to preserve confidentiality and privilege, citing Cygnett Pty Ltd v Souris [2020] FCA 1754 (Cygnett) at [32].

53    The applicant also referred to Kenquist Nominees Pty Ltd v Campbell (No 5) [2018] FCA 853 at [49] which is as follows:

The question of waiver turns on all of the circumstances. It may be accepted that the degree to which the interests of the disclosing person coincide or diverge from the interests of the person to whom the privileged communication was disclosed is relevant to the conclusion as to whether the disclosure was conduct inconsistent with maintaining confidentiality in the otherwise privileged communication. The mere fact that the parties’ interests are not completely aligned, or even that they are opposed in particular respects, does not have the necessary consequence that the conduct in disclosing the communication effects a waiver of privilege. It is necessary to be precise about how the interests are said to diverge and how this is said to relate to the content of the privileged advice said to have been waived and to the acts said to be inconsistent with maintenance of the confidentiality the privilege is intended to protect.

54    It was also submitted that litigation privilege attaches, referring to Trade Practices Commission v Sterling [1979] FCA 33; (1979) 36 FLR 244 (Sterling) at 246 (the sixth category). At the time, the commencement of defamation proceedings against the respondents was more than a mere possibility; there was a real prospect of such proceedings being commenced. Upon publication of the article on 8 June 2018 by the respondents, which contained allegations that the applicant through his solicitor had said were false and defamatory, there was a real prospect of litigation rather than a mere possibility; it was by then in actual contemplation and more likely than not, citing Mitsubishi at [19].

55    The respondents submitted that the applicant’s claim over this document fails for three reasons.

56    First, the Report is not a document capable of attracting privilege. It was commissioned, authored and communicated by and between two strangers to the privileged relationship, being Mr Coulthart and Mr McWilliam. It is submitted that the applicant’s witnesses gave conflicting accounts of who the relevant principal is. After analysing the applicant’s evidence and submissions, or what it said was the lack thereof, it submitted that taken as a whole, it identifies the applicant as the principal. Mr O’Brien and Mr Moses SC are the relevant legal advisors and Mr McWilliam and Mr Coulthart are third parties. That means the Report is incapable of attracting privilege because the Report is a communication between two third parties. I note, however, that during the hearing the respondents also submitted that in truth it was Mr McWilliam who was the principal. If it is Mr McWilliam, the respondents again submitted that the Report is not privileged because it is a communication between two third parties and the fact that the Report later comes into the lawyer-client relationship does not make it privileged. The respondents also noted that legal advice privilege is the only potential option because litigation privilege does not apply to a document prepared for the dominant purpose of being used in an inquiry: AWB at [158]-[165]. Other than the references to a “potential claim for defamation” in Mr McWilliam’s affidavit, the applicant’s evidence uniformly suggests that the Inquiry was the only legal process in mind. This, the applicant contends, is confirmed by Mr O’Brien’s evidence that the Report was provided to Mr Moses SC because he had been briefed in relation to the Inquiry and that the Report has not been disseminated beyond the applicant’s legal team for the Inquiry. As such, the categories identified in Sterling do not apply.

57    Second, even if the Report was capable of attracting privilege, the Report did not have the dominant purpose of the applicant or any other person obtaining legal advice. In particular, the Report was prepared for several roughly equal purposes, many of which were non-legal and none of which were dominant. The respondents analysed the evidence and submitted that many different subjective purposes are identified, with Mr McWilliam having at least five different purposes. The applicant also at times refers to Mr Coulthart having his own subjective purposes for preparing the Report, which include, for example, the possibility of him making a story in his capacity as a journalist. This, the applicant submitted, is reflected in Mr Coulthart’s conduct, in particular, in his dealings with the respondents’ editorial staff.

58    The respondents contend that the purposes for which the Report was created may be readily discerned from both the subjective and objective evidence. It was submitted that the objective circumstances further undermine the applicant’s claim that the dominant purpose of the Report was for him to obtain legal advice. These objective circumstances include that the Report was commissioned by Mr McWilliam, a representative of the applicant’s employer and the entity underwriting his legal fees, it was authored by Mr Coulthart, a public relations adviser and a journalist, and neither Mr McWilliam nor Mr Coulthart are part of the applicant’s legal team. Moreover, the Report was sent to Mr McWilliam, and not to the applicant or his lawyers. Additionally, the content of the Report is important. For example, Mr McWilliam’s instructions to Mr Coulthart, as set out in his affidavit, were to “examine the various rumours and allegations about [the applicant] and [his] response to them and to investigate and check them out independently to the extent [Mr Coulthart] can”. It was submitted that the Court may readily infer that is what the Report does, and as such, the Report equally benefits the applicant and a third party (such as a funder or someone concerned about reputational risk) who wishes to independently test the veracity of an account he or she has been told. The contents equally support a conclusion that the commercial and reputational concerns of Mr Stokes, and SWM, were the primary reasons for its commission. It was further submitted that the context in which the Report was commissioned tells against the claim.

59    Third, any privilege that does exist has been waived by Mr Coulthart and Cato & Clive disclosing the substance of the Report to the respondents. Mr Coulthart repeatedly represented to Fairfax’s management and Mr McKenzie that he had conducted “numerous interviews with serving and former SASR operators and other sources here and OS” and that the allegations against the applicant “would be strongly and credibly disputed by numerous credible direct witnesses”. By doing so, Mr Coulthart repeatedly and purposely disclosed the results of his investigation to the respondents. The applicant has led no evidence to suggest the substance of the Report and the substance of Mr Coulthart’s disclosures are different, or that the disclosures were unauthorised.

Consideration

60    Before specifically addressing the issue of the intended use(s) of the Report which accounted for it being brought into existence, it is appropriate to address the circumstances in which the Report was commissioned.

61    There was some dispute between the parties as to these circumstances.

62    The applicant identified the following circumstances.

63    On or around 6 July 2017, Mr Masters sent an email to the applicant attaching sections of the manuscript from his forthcoming book ‘No Front Line’. In his covering email, Mr Masters suggested that the applicant had been involved in an alleged execution of a person under confinement (a PUC), and the applicant forwarded this email from Mr Masters to Mr Stokes, Mr McWilliam and Mr O’Brien.

64    In mid-2017, the applicant engaged his solicitor, Mr O’Brien, at Mr McWilliam’s suggestion, in response to approaches made to the applicant by Mr Masters. Mr McWilliam was General Counsel and Commercial Director of SWM. The applicant has been an employee of SWM since approximately 2012. The applicant’s legal fees were funded by SWM.

65    On 11 July 2017, Mr O’Brien sent a letter to the chief executive officer of Allen & Unwin, the publisher of Mr Masters’ books. At the conclusion of that letter, Mr O’Brien wrote:

Mr Masters is clearly motivated to attract publicity for his book and attention to himself by such false and defamatory attacks upon my client. I have very firm instructions to take all necessary steps to protect my client’s impeccable reputation but trust that will not be necessary.

66    On 18 and 19 July 2017, Mr O’Brien wrote to Persons 1 and 2 respectively, concerning matters raised in the draft manuscript provided to the applicant by Mr Masters, asserting that it is apparent from the transcript that each has made allegations to Mr Masters and that if those allegations appear in the book, he had instructions to commence defamation proceedings against each individually, in addition to Mr Masters and the publisher.

67    On 17 October 2017, Mr McKenzie wrote an email to Mr O’Brien in which he asked whether the applicant would agree to attend an interview with Mr McKenzie in relation to a story that he was working on surrounding the applicant’s Commendation for Distinguished Service Medal and his Medal for Gallantry award. Mr McKenzie stated that he had been informed that several of the applicant’s ex-colleagues had spoken about him to the Inquiry, and he asked whether the applicant had been questioned by the Inquiry.

68    On 18 October 2017, Mr O’Brien sent Mr McKenzie a letter, at the conclusion of which he stated that his instructions were to commence immediate defamation proceedings in this Court if any false and defamatory allegations were published concerning the applicant. The next day, 19 October 2017, the respondents published a story written by Mr McKenzie called ‘The fog of war and politics leads to controversy over Afghan war mission’. The story mentioned the Inquiry, complaints that had been made by Special Air Services Regiment (SASR) members about the applicant, including his Commendation for Distinguished Service, and the story suggested that well-placed sources said it was likely that the Inquiry would wish to interview the applicant regarding the complaint as well as those who were involved in making the complaint. The substance of the complaint was not disclosed, and the story went on to say that the Inquiry is focused on allegations that have nothing to do with the applicant or any other soldier mentioned in this story.

69    On 28 May 2018, Mr McKenzie wrote to the applicant alleging, inter alia, that he had kicked an unarmed detainee off a cliff in Darwan, Afghanistan, and was also responsible for his murder. On 30 May 2018, the applicant’s solicitor notified Mr McKenzie that the allegations were false and defamatory and that he had instructions to “commence immediate defamation proceedings … if the same or similar allegations as outlined in your email are broadcast or published. … In anticipation of the Federal Court Proceedings, I formally put you on notice to retain all text messages, emails … telephone records, drafts and notebooks relating to [the applicant]”.

70    On 8 June 2018, the SMH published an article by Mr McKenzie and Mr Masters alleging that an SASR soldier named “Leonidas” kicked a prisoner of war off a cliff in Darwan. The article suggested there were firsthand witnesses and asserted that this incident was being investigated by the Inquiry. On 14 June 2018, Mr O’Brien wrote to Mr McKenzie seeking, amongst other things, undertakings from Mr McKenzie and Mr Masters not to identify the applicant as Leonidas.

71    To that, the respondents added two groups of events.

72    The first relates to an email of 6 June 2018, which the applicant sent to Mr O’Brien and Mr McWilliam, stating that Mr Stokes had approved support for another SASR member who had been summoned to appear before the Inquiry. That person is said to be Person 35. The second relates to what was said to be communication by the applicant with Persons 5, 11, and 35 about what was being said in the Inquiry in the period from the Report being commissioned until a hard copy was provided to Mr McWilliam.

73    I will return to the issue of the relevance of these additional matters below.

74    Against that background I turn to the evidence as to the purpose for which the document was created.

75    The starting point is to consider what were the intended use or uses of the Report which accounted for it being brought into existence: Pratt 2004 at [35]. The purpose for which a document is brought into existence is a question of fact that must be determined objectively, having regard to the evidence, the nature of the document, the nature of the communication, the content of the communication, the relevant context and the relationship between the parties, and the parties’ submissions: AWB at [109]-[110]. The relationships are an issue in this context, as they impact the assessment of the dominant purpose for which the communication occurred. Although attention is ordinarily focussed on the purpose(s) of the person who created the document, that is not so in this instance where the document was procured by others: Hartogen Energy at 568-9. As explained above, evidence of the subjective purpose for which the document is brought into existence is relevant, and although not necessarily conclusive, it is often decisive: Esso at [172].

76    It is important to recall that the purpose for which the Report was prepared is to be adjudged at the time of its creation. At the outset, it is appropriate to recall that the evidence of the applicant’s witnesses was unchallenged.

77    It was contended by the applicant, and ultimately not challenged by the respondents, that one of the purposes of commissioning the Report was to provide it to the applicant’s lawyers to best protect his interests. The applicant submitted that there was another purpose, to enable SWM to obtain advice from an external lawyer (Ms Munsie) if Mr McWilliam determined it was necessary to do so given that SWM was funding the applicant’s legal fees, but that that was a subsidiary purpose. The applicant submitted that it can be inferred that SWM also has a claim for privilege by reason of its common interest in the document and because Mr McWilliam also intended to obtain separate legal advice.

78    The issue is whether it is established Document 1 was created for the dominant purpose of obtaining legal advice or in anticipation of either potential defamation proceedings and/or the applicant being called before the Inquiry, such as to attract a claim for legal professional privilege.

79    The applicant’s submission that the evidence establishes that Mr McWilliam was acting on his authority, can be accepted. The conversation between Mr McWilliam and the applicant is deposed to by each party, in respect to Mr McWilliam recited above at [13], and Mr Roberts-Smith recited above at [25]. It was the applicant who authorised the creation of the document. He agreed to its creation on his behalf, without which, it can be inferred, this investigation would not have occurred, and this document would not exist. The applicant is the client, or the principal, and is making the claim as such.

80    It was the applicant who authorised the commission of the Report and Mr McWilliam who organised its preparation. The applicant’s subjective state of mind as to the purpose of its creation, the evidence of which is recited above at [27], is plain. Its creation was for the purpose of obtaining legal advice including to be used in preparation for giving evidence at the Inquiry. At this time, there was a real prospect that he might be called. What was authorised to be undertaken, was to be confidential. The applicant understood that the Report was to go to his lawyers to assist them to provide him legal advice. He agreed to the Report going to Mr McWilliam and the Chairman of SWM on the basis they were financially backing him. Mr McWilliam (and SWM) at the time had a common interest with the applicant. It can be inferred that there would be no Report without the applicant authorising its commission. His evidence as to the purpose of the Report is consistent with the conversation he had with Mr McWilliam at the time the Report was authorised.

81    It was Mr McWilliam who, having been authorised, organised or arranged for the Report to be prepared, communicating with Mr Coulthart. Mr McWilliam, in his discussion with the applicant, the applicant’s lawyer and Mr Coulthart, described the purpose being for use in the obtaining of legal advice by the applicant from his lawyers or in anticipation of the applicant being called to give evidence in the Inquiry and possible defamation proceedings. Mr McWilliam also explained that at the time he “also thought that a copy of the report may need to be provided to Justine Munsie in case she needed to provide any advice to Mr Stokes, the Chairman”. At the time, SWM were funding the applicant’s legal fees, with the backing of the Chairman. In that context, Mr McWilliam considered that it was important he and the Chairman should also receive a copy of the Report as he wanted to ensure that any decision to continue to support the applicant was a “considered one” and so they could obtain external legal advice if that would be required. That is why Mr Coulthart was asked to address the Report to Ms Munsie as well as Mr Moses SC. The evidence of conversations Mr McWilliam had with the applicant is consistent with those purposes. I appreciate that the respondents submitted that from Mr McWilliam’s evidence at least five purposes were identified, but four of those appeared to be interrelated, and if anything, different facets of the same thing. Properly understood, it centred on the possibility of needing to get advice from external counsel in a context where SWM were funding the applicant. The other purpose identified, and accepted by the respondents, was for the applicant’s lawyers to advise him in relation to the Inquiry and potential defamation claim

82    I note that the respondents also referred to Mr Coulthart’s purposes in the creation of the Report. However, properly considered, as the author of the Report, which was commissioned by others, his purpose does not advance the matter. Suffice to say the nature of his investigation was clear and not challenged, and nor was the fact that he has not disclosed the contents of the Report to anyone other than Mr McWilliam and Mr Stokes. Moreover, the respondents’ basis for his purported purposes are drawn from text message exchanges between Mr Coulthart and Mr McKenzie on 1 August 2018, some weeks after the Report was completed. Although the respondents refer to the messages as contemporaneous, they are not. Properly read, the purported purposes referred to cannot be inferred from those messages. Those purposes are not borne out by the underlying evidence relied on by the respondents. I note also at this stage that it is apparent from the text messages that it is the respondents who approached Mr Coulthart and unsuccessfully pursued an interest in speaking to him. I will return to these messages below in relation to the respondents’ submission that if the claim for privilege is established, it has been waived.

83    That said, even if it was Mr McWilliam’s “project”, it does not necessarily follow that its creation was not for the purpose of obtaining legal advice or in anticipation of litigation. When careful attention is directed to the evidence, although the respondents are correct as to some aspects of the submissions as to what Mr McWilliam did to engage Mr Coulthart and disseminate the Report, others do not withstand scrutiny. The submission also appears to consider the conduct of Mr McWilliam in isolation from the broader circumstances in which it occurred.

84    It may be accepted that it was Mr McWilliam’s idea for Mr Coulthart to conduct an investigation, but that of itself, as the respondents conceded, does not advance the matter. It can also be accepted that it was Mr McWilliam who contacted Mr Coulthart, but this is in a context where he was authorised to do so by the applicant.

85    It was said by the respondents that Mr McWilliam chose to whom the Report was addressed. The submission is artificial. Although Mr McWilliam did inform Mr Coulthart to whom the Report was to be addressed, the purpose of the Report informed the identity of those persons. Mr McWilliam said to Mr Coulthart to address the Report to the applicant’s lawyer, Mr Moses SC, which, given the purpose for which the Report was created, is to be expected. That can hardly be seen as a choice, but rather the inevitable consequence of the purpose for obtaining the Report being to provide it to the applicant’s lawyers to enable them to advise the applicant. I note that the respondents’ submission appeared to imply there was some choice involved by Mr McWilliam because the Report was not provided to the applicant or Bruce McClintock SC (the applicant’s defamation counsel at the hearing of the substantive proceeding). As to the former, the Report went to the applicant’s lawyer because of, and consistent with, the stated purpose for which it was created. Given that purpose, the applicant not receiving it should be uncontroversial. As to the latter, the evidence is that Mr McWilliam understood that Mr Moses SC at that time was representing the applicant in connection with the Inquiry. There is no evidence as to Mr McClintock SC, or of his involvement in any of these matters at this time. Mr McWilliam also said to address the Report to Ms Munsie because he considered, in light of the purpose of the Report, if SWM did decide to get external advice, she was the person from whom it would be sought.

86    Again, it may be accepted that on completion of the investigation the Report was provided to him by Mr Coulthart, and in accordance with the stated intention, copies were given to the applicant’s lawyers (his solicitor for the provision to counsel) and Mr Stokes. Mr McWilliam did not give a copy to Ms Munsie as he, at that stage, considered it was not necessary to get external advice, and that he could give the advice. I do not accept the respondents’ submission that Mr McWilliam had the Report delivered to him “reserving to himself the right to decide from thereon where the document went”. Mr McWilliam did not receive the Report to then make “decisions about who gets it and in what circumstances”. The Report was to go to the applicant’s lawyers. Mr McWilliam was the conduit and he provided the Report to Mr O’Brien, the applicant’s solicitor, who then provided it to Mr Moses SC, his barrister. There is no proper basis to suggest that was not going to happen, or that he reserved for himself the decision whether it was to happen. The unchallenged evidence was that he simply made a copy and distributed it to them, consistent with its purpose and in accordance with what was authorised by the applicant. In any event, the respondents’ submission, that Mr McWilliam then “elected” to give the applicant’s lawyers the Report, as if there was some choice to be had, is not supported by the evidence. Indeed, in oral submissions the respondents accepted that Mr McWilliam was to provide the Report to Mr Moses SC. The only decision to be made was, after having received the Report, whether SWM would get external advice, and so whether it would be forwarded to Ms Munsie. The respondents’ submission that the Report was “kept back from Ms Munsie”, does not represent what, according to Mr McWilliam’s evidence, occurred.

87    The respondents’ submission proceeded on an incorrect characterisation of what occurred.

88    I note also in this context, that there is no evidence to support the respondents’ submission that a “conscious attempt” was made to “cloak the Report in privilege” by inserting the names of Ms Munsie (who did not know why her name was included) and Mr Moses SC on the Report, in so far as it suggests this was a device used to somehow attract privilege. Rather, the unchallenged evidence was that Mr Moses SC and Ms Munsie were the persons to whom the Report was to be addressed because it was Mr Moses SC who was to receive the Report, and Ms Munsie if it was decided external advice was needed. That Mr McWilliam asked that their names be on the Report, explained their role and that the Report is confidential and privileged, reflects the position. As explained below, an objective assessment of the purpose for which the Report was created, is consistent with that evidence. There is no suggestion in the evidence (or from the circumstances in which it was created) that the reference in the Report to it being privileged, and that it was addressed to those persons, was other than bona fides. It is typical of a report prepared in a context considered to be covered by legal professional privilege. This is consistent with the evidence of Mr McWilliam, Mr Coulthart and the applicant as to the circumstances of the Report’s commissioning. I note also that Mr McWilliam’s conversation with Mr O’Brien, recited above at [31], which was shortly after the publication of the articles, reflects the intention as to the purpose of the Report and that it was to be provided to the applicant’s lawyers to assist them in relation to advising the applicant. That Mr McWilliam did not send the Report to Ms Munsie as he had decided that external advice was not needed, does not alter that: see Sterling at 245; Pratt 2004 at [19]; Kennedy v Wallace [2004] FCAFC 337; (2004) 142 FCR 185 at [232], [234].

89    A number of further factual observations can be made.

90    First, the evidence establishes that the Report was commissioned on the basis that it was confidential, and it was to be treated as such at the time of its commission, with the only persons it was to be provided to being the applicant’s lawyers, Mr McWilliam, Mr Stokes, and possibly Ms Munsie, if Mr McWilliam considered that SWM needed to obtain external legal advice. The Report was marked “STRICLY PRIVATE AND CONFIDENTIAL. THIS DOCUMENT WAS PREPARED FOR THE PROVISION OF LEGAL ADVICE AND ITS CONTENTS ARE STRICLY PRIVILEGED”. Although not conclusive, as noted above, this is typical of what might occur if the document was prepared for a privileged purpose(s). It reflected on its face that it is confidential. Once received, and in the hands of any of those persons, it was to be treated confidentially by them. There was an obligation of confidentiality. The evidence establishes that, consistent with that stated intention, the Report has been treated in this manner.

91    Second, the evidence establishes that there is a common interest between the applicant and SWM in the contents of the Report. SWM, at that time, were indemnifying the applicant’s legal fees, the applicant was employed by SWM in a high profile position and there was a commercial benefit to SWM in protecting the applicant’s reputation, which would equally protect the reputation of SWM. The respondents did not directly address that submission, but rather contended that any claim of common interest reinforced that there was no dominant purpose. The respondents also submitted that demonstrating a common interest shows “the very separation of interests”. That is, the very purpose of getting the Report is so that SWM can test what the applicant is saying and the allegations that have been made against him, and so they can make a commercial decision which reflects their financial interests and also their reputational interests. It was said that the Report was “designed to…stress test the applicant”, and therefore was not a “friendly common purpose”. If that is said to enable SWM to make an informed decision as to funding of legal fees, it does not follow there is no common interest. If the submission to “stress test” the applicant is something more, that is not supported by the evidence. Many of the respondents’ submissions as to why the Report was commissioned are speculative in a context where the applicant’s and Mr McWilliam’s evidence was not challenged. That Mr McWilliam expressed the view that he thought that it was important that he and the Chairman get a copy of the Report to ensure any decision as to continuation of support of the applicant (and that he can answer any questions about them doing that) was a “considered one”, does not alter that there was a common interest. The respondents did not address the submission as to the effect of the common interest on the privilege claim, if the applicant’s submission as to its existence is accepted.

92    The evidence establishes that in about mid-2017, after being informed by the applicant of the approach by Mr McKenzie, Mr McWilliam suggested to the applicant to retain Mr O’Brien as he was a specialist defamation lawyer. The applicant had informed Mr McWilliam the allegations were false. At the time, Mr McWilliam was concerned that the applicant’s employment by or association with SWM may have been a contributing reason as to why he was being targeted by Mr Masters, and he considered that SWM had a duty of care to the applicant. The stories were being published by a rival media network.

93    Although the Report did not involve direct lawyer-client communication (between the applicant and his lawyers), SWM had a common interest. Any involvement of Mr McWilliam, (and Mr Stokes), is in that context.

94    In Network Ten Ltd v Capital Television Holdings Ltd (1995) 36 NSWLR 275 (Network Ten) at 279, Giles J explained common interest privilege at common law as follows:

If two parties with a common interest exchange information and advice relating to that interest, the documents or copy documents containing that information will be privileged from production in the hands of each; thus, if one of the parties obtains a letter of advice attracting legal professional privilege and provides it to the other, the other can also claim legal professional privilege.

95    In this context “common interest” is not a “rigidly defined concept” and a question of fact in each case: Farrow Mortgage Services Pty Ltd (in liq) v Webb [1996] NSWSC 259; (1996) 39 NSWLR 601 (Farrow) at 609B; Rickard Constructions Pty Ltd v Rickard Hails Moretti Pty Ltd [2006] NSWSC 234 (Rickard Constructions) at [51]; Cygnett at [16]. Categories of relationship in which a sufficient commonality of interest will arise, or is likely to arise, are not closed: Cygnett at [16]. Parties to litigation “interested in a particular question” will not “have a common interest for the purposes of common interest privilege if their individual interests in the question are selfish and potentially adverse to each other. In such a case there will not be the necessary identity of interest”: Ampolex Ltd v Perpetual Trustee Co (Canberra) Ltd (1995) 37 NSWLR 405 at 410A, cited with approval in Patrick v Capital Finance Corporation (Australasia) Pty Ltd [2004] FCA 1249; (2004) 211 ALR 272 at [22]; Media Ocean Ltd v Optus Mobile Pty Ltd (No 10) [2010] FCA 1348 (Media Ocean) at [52]; Cygnett at [22].

96    It is now well established in Australia that a “mere” common interest in the outcome of litigation will be sufficient to enable any party with that interest to rely on common interest privilege: Farrow at 609B; Media Ocean at [53]; Hamilton v New South Wales [2016] NSWSC 1213 at [75]; Cygnett at [19].

97    In Cygnett at [24], O’Callaghan J said, citing Inlon Pty Ltd v Celli SpA [2017] NSWSC 569 at [107], that:

I agree that the authorities make it clear that “the ultimate question is whether, at the time the communication is made, there is an express or implied obligation of confidentiality” and that a court “should not refuse to imply such an obligation if the circumstances otherwise justify it, merely on account of the potential for some sort of change in the parties’ relationship at a later point”.

98    Common interest privilege has been held to exist in the context of providing information to a person funding the legal advice or litigation: see for example Rickard Constructions at [57]-[59].

99    In Rickard Constructions, Bergin J when considering whether the contents of documents, copies of which were provided to the funder, were confidential and were prepared by the lawyers for “the dominant purpose” of “providing legal advice” to the plaintiff, concluded at [56]-[59]:

[56]    This is not a case in which a professional funder has decided to “invest” in the proceedings for the prospect of profit. As I have said earlier, each case must be considered on its own facts. The type of funding, the arrangements for funding, the relationship between the funder and the funded party and the nature of the interests of the funder and the funded party will require analysis to determine whether there is an identity of interests such that they may be categorised as “common”.

[57]    I have already analysed the type of funding, the arrangements for funding and the nature of the relationship between the funder and the plaintiff. I am of the view that the funder had and has an interest in the most advantageous conduct of these proceedings by the plaintiff. That interest is identical with that of the plaintiff: Bulk Materials at 695. I am satisfied that the funder in this case has “a common interest in relation to” the proceedings and thus s 122(2) and s 122(4) do not apply. Even if that is wrong I am not satisfied that privilege was waived under s 122(2) because the documents were provided to the funder in the course of a confidential communication. As s 122(2) “operates” in this instance s 122(4) need not be considered.

[58]    A different question arises under s 119 of the Act [litigation privilege]. It is whether the communications were for the dominant purpose of the plaintiff “being provided with professional legal services”. I have already decided that the communications were confidential communications. The dominant purpose in the confidential communications was to provide information to the funder so that it would source the continued funding of the litigation. It may be argued, as it was in Global Imaging, that such a purpose is anterior to the dominant purpose of the client “being provided with professional legal services”. In Global Imaging Santow J held that the funding agreement in question in “a literal and substantive sense, fulfils the purpose of providing legal services in terms not only of the overall capacity to have them at all, but also their availability at critical junctures in the case” (at [7]).

[59]    In this case it is the confidential communications rather than the funding agreement that are under consideration. They are not anterior to the dominant purpose, they are inextricably linked to the nature of the professional legal services being provided to the client. Their dominant purpose was to ensure the overall capacity of the plaintiff to have funding and to ensure that such funding would be forthcoming for the continued funding of the litigation. That seems to me to fall within the description of a dominant purpose of the client “being provided” with professional legal services. This description is to be contrasted with the expression “providing professional legal services”. The concept of the client “being provided with” something is of broader import and seems to me to encompass the purpose under consideration here. I am satisfied that the documents are also privileged pursuant to s 119 of the Act.

100    Although that passage recited above relates to the Evidence Act 1995 (NSW), the reasoning appears equally apt in the common law context.

101    Although not a professional funder, SWM, with the backing of Mr Stokes, was at this time providing direct legal funding to the applicant and Mr Coulthart’s Report enabled those backing him to be kept abreast of the allegations then known and the applicant’s response to them and possibly to receive legal advice in that context. Mr McWilliam’s evidence that he was of the opinion that the Report would assist the applicant and his lawyers to advise him of any possible attendance at the Inquiry and also in relation to a potential claim for defamation is consistent with SWM having a common interest in protecting the applicant’s reputation (which would include, practically speaking, that his lawyers be in the best position to advise him). As the funder and his employer, SWM has an interest in the applicant being put in the most advantageous position in respect to providing such advice (including as to any future attendance at the Inquiry and any possible defamation claim).

102    Pausing there. The respondents made much in their submission that the Report went to Mr McWilliam and not directly to the applicant’s lawyers, as reflecting that the Report is not privileged. That is, if the Report was for privileged purposes it would have gone directly to the applicant’s lawyers: see for example Pratt 2004 at [47]; Asahi Holdings (Australia) Pty Ltd v Pacific Equity Partners Pty Ltd (No 4) [2014] FCA 796 (Asahi) at [37]-[40]. However, the above discussion at [86] puts that submission in context. If Mr McWilliam’s involvement in receiving and delivering the Report to the applicant’s lawyers (as a person with a common interest with the applicant who was to receive a copy of the Report for himself in that capacity) was doing so merely as a conduit, the denial of privilege is made on the basis of form over substance. On the unchallenged evidence, there was no filtering or exercising of independent judgment by Mr McWilliam in respect to providing the Report to the applicant’s lawyers: cf Pratt 2004 at [47]. The only judgment was in respect to the need for external advice for SWM. The focus of the inquiry as to the purpose of the Report should be on the basis for which Mr Coulthart was engaged: see for example Pratt 2004 at [41], [103]; Asahi at [38]. This is also illustrated by the fact that if the Report had been delivered directly to the applicant’s lawyers, and thereafter they provided a copy to Mr McWilliam, for a common interest, the claim of privilege would be maintained.

103    Third, it may be seen as rather unusual, at least on the surface, that the Report was compiled by an investigative journalist. The respondents emphasised this description, and repeatedly referred to the Report having been commissioned to a journalist and how a journalist would approach their investigation of matters. However, as the respondents accepted in arguendo, lawyers often use investigators. In this case, on the evidence, Mr Coulthart was commissioned in that capacity, to investigate and report. I note also that another document caught by the subpoena is another report (which is referred to and described in Mr O’Brien affidavit) from a later investigation undertaken by Mr Coulthart on the applicant’s behalf, on which the applicant claims privilege, of which no challenge is made by the respondents. In that context, the relevance and significance of the respondents’ submission that the Report was compiled by Mr Coulthart, who is a “journalist”, is unclear.

104    Fourth, as noted above at [72], the respondents add two categories of events to the circumstances in which the Report was created. It is necessary to make some comments on the submissions to which that evidence was said to be relevant. The respondents asserted that Persons 35 and 11 are represented in these proceedings by Ms Munsie. The relevance of that fact is entirely unclear. Nor is there any basis in the evidence to suggest that Ms Munsie was then representing these persons. The affidavit of Mr Bartlett on which the submission appears to be based does not support that assertion. I note also in that context the respondents’ submission that SWM agreed to fund the legal fees of Person 35 and at least one other person (likely Person 11), and “it is unsurprising that Mr Stokes and Mr McWilliam immediately commissioned a Report by a trusted contact to determine whether SWM would continue funding those soldiers in light of the Fairfax reporting”. There is no evidence to support that submission. Mr McWilliam’s evidence, which makes no reference to such a proposition, was not challenged.

105    The second category of events was the conduct of the applicant in communicating with Persons 5, 11, and 35 in the two week period from the Report being commissioned until a hard copy was provided to Mr McWilliam. To establish that contact, the respondents put before the Court transcript of the applicant’s cross-examination in the substantive proceeding. It was submitted by the respondents that in effect there were “two streams of communications about what people are saying about these allegations”. It was said that after the SMH articles were published on 8 and 9 June 2018, the applicant communicated with his friends about the allegations. At the same time, Mr Coulthart was carrying out his investigation and presumably sought to interview the same class of persons. The submission seemed to imply there were in effect, two concurrent investigations. I note that, taking the respondents’ submission at its highest, it is not suggested anyone, apart from the applicant, knew of his purported conduct.

106    When pressed as to the relevance of this in assessing the claim for privilege, the respondents submitted that the applicant speaking to his “friends” makes it objectively less likely that the dominant purpose of preparing the Report was a privileged purpose. Leaving aside whether the transcript of the applicant’s cross-examination supports the breadth of the submission as to what the applicant was purportedly doing, and the very speculative nature of the submission as to what was occurring in respect to Mr Coulthart’s investigation and the applicant’s conduct, the logic does not follow. Moreover, that submission also ignores the unchallenged evidence of the basis on which the Report was commissioned, what the investigation was to do and what Mr Coulthart describes in his affidavit he did. As the applicant submitted, referring to Mr Coulthart’s affidavit, there is no suggestion that in preparing the Report he spoke to anyone other than the applicant. Importantly, that submission does not address how the applicant speaking to his friends after the Report was authorised by him, affects the objective assessment of the purpose for which the Report was created. I do not accept the submission.

107    Intertwined with this was a submission by the respondents that the purpose for the creation of the Report could not have been for the applicant and his lawyers, because his lawyers had nothing to do with the Report and would not have permitted the applicant to be interviewed “by a journalist without their presence”. Although the respondents referred to Mr Coulthart as a “journalist”, as noted above, he was acting as an investigator. The applicant and Mr O’Brien agreed to this investigation, and their evidence was not challenged as to the purpose of the Report. It is plain on the evidence that Mr Coulthart was to interview the applicant and prepare a report, for use by his lawyers. Indeed, Mr Coulthart’s evidence as to the investigation only described doing that. The applicant’s solicitor was aware that the applicant was to be spoken to. Moreover, if anything, the inference is that the applicant would not have agreed to authorise this, and his solicitor would not have agreed to (or been content with) it occurring, but in a context where it was to assist them, to provide legal advice and for use in potential litigation. Indeed, the inference to be drawn is that this Report would not have been created (or agreed to) except in those circumstances.

108    The respondents also submitted that another relevant aspect when assessing the objective purpose, was that the applicant had already given his lawyers instructions. It was submitted that by May 2018, the applicant’s lawyers had already taken instructions from him in relation to Whiskey 108 and Darwan. This is said to be because on 28 May 2018, Mr McKenzie wrote to the applicant putting to him allegations of murder at Darwan and Whiskey 108, and two days later, Mr O’Brien responded that the allegations were “false” and defamatory. That could only have been made if the applicant had given instructions on Darwan and Whiskey 108. Therefore, it was said that it is objectively less likely that some two weeks later, a report was commissioned for the dominant purpose of enabling the applicant’s legal advisors to provide him with advice on matters he had just recently provided instructions on. However, that submission fails to grapple with the respondents’ acknowledgement that one of the purposes of the Report was for it to be provided to the applicant’s lawyers, which must be to assist in providing legal advice. Moreover, the submission is speculative as to the extent of any instructions provided, and ignores the breadth of the investigation in relation to other rumours (that is, not confined to those two matters).

109    I note that the matters relied on by the respondents, referred to above, as to why objectively the dominant purpose was not the obtaining of legal advice (or in relation to the Inquiry or defamation proceedings) are inconsistent with the subjective intention of the applicant and Mr McWilliam and the contemporaneous communications (including between them, and in relation to Mr Coulthart and Mr O’Brien).

110    The subjective evidence reflects that the Report was created for the dominant purpose of obtaining legal advice which included to prepare for the potential of the applicant giving evidence before the Inquiry, as well as obtaining evidence or information for potential defamation proceedings. The subjective evidence as to the purpose for which the Report was created (of the applicant but also Mr McWilliam), reflects that, and that SWM’s interests were subsidiary to that dominant purpose.

111    That subjective intention as to the purpose of the Report at the time it was created is supported by an assessment of the objective circumstances in which it occurred. It is consistent with the contemporaneous communications and conduct concerning the creation of the Report.

112    I am satisfied that an objective assessment of the circumstances in which this Report was created establishes that it was for the dominant purpose of obtaining legal advice, including preparing the applicant to give evidence in the Inquiry, and possible defamation proceedings which, on the evidence, were actually contemplated. Professional advice given by lawyers to a client as to what evidence and submissions should be placed before a commission of inquiry, is legal advice capable of attracting legal professional privilege: AWB at [100]. Moreover, by the time of the creation of the Report, there was a real prospect of litigation: Mitsubishi at [19].

113    Mr Coulthart’s role was to summarise the various allegations and rumours concerning the applicant about his service in Afghanistan which had been published by the respondents or been the subject of threats to publish in numerous pieces of correspondence sent by the respondents. He was to speak to the applicant about those allegations and to elicit his response to them and to gather any other material or information that may be relevant for provision to the applicant’s lawyers. The number of allegations and rumours appeared to be growing over time. The Inquiry was underway and what was being reported made it likely that the applicant would be called before it. The correspondence between the applicant’s solicitor and the respondents leading up to this Report being created made the prospect of defamation proceedings a realistic one.

114    As explained above, that Mr McWilliam, who had a common interest with the applicant, contacted Mr Coulthart with the applicant’s authority, and received the Report from Mr Coulthart, given the nature and content of the communication, the relevant context and the relationship between the parties, does not deny the claim for privilege. These communications were made on behalf of the applicant, for the dominant purpose of putting before the applicant’s lawyers, material to be used to provide legal advice or in anticipation of litigation.

115    I do not accept the respondents’ submission that the purpose of protecting the interests of SWM (and what that was said to entail) was dominant or equal with the privileged purpose(s). Although it may be readily accepted a purpose in the creation of the Report was to inform SWM of the allegations and the applicant’s response to enable SWM to obtain advice from an external lawyer if necessary in respect to their position as to funding, in all the circumstances that was a subsidiary one. That nonetheless, was also for potential legal advice, a privileged purpose. I note also in that context, even if Mr McWilliam was also a principal, in this matter, given the dominant purpose of the Report and the common interest, it would not affect the outcome of the applicant’s claim.

116    The respondents contended that if privilege did exist, it had been waived by Mr Coulthart. It was submitted that Mr Coulthart repeatedly and purposely disclosed the results of his investigation to the respondents. It was suggested that the applicant was a potential beneficiary of Mr Coulthart’s back-channelling. The evidence relied on by the respondents commenced with Mr McKenzie contacting the applicant on or about 1 August 2018 (six weeks after the investigation was completed and the Report provided) wanting to know who he was working for, and whether it was Channel 7. It was apparent that after that Mr Coulthart texted James Chessell, the Executive Editor of the SMH and The Age, complaining of Mr McKenzie’s conduct in contacting him and the content and tone Mr McKenzie had used in confronting him. Although Mr Coulthart says he works for Cato & Clegg, there is no reference at all in the correspondence to any investigation being conducted by him for the applicant. That people have been reaching out to him at that time, says nothing about when that occurred, the content of it, or any other matter which the respondents rely on. Even if that were so, there is no evidence this was obtained by him in the investigation for the purpose of the Report, or was in the Report. The submission is speculative. Moreover, as explained above when addressing the respondents’ submission as to Mr Coulthart’s purpose, it was the respondents who contacted him, and pursued him unsuccessfully thereafter. In any event, given that the unchallenged evidence from Mr Coulthart is that he has not disclosed the contents of the Report to anyone except Mr McWilliam and Mr Stokes, I am not satisfied that that the material relied on by the respondents represents a waiver of privilege.

117    All that said, I nonetheless looked at Document 1, which only served to confirm the conclusions reached.

118    I am satisfied that in relation to Document 1, the claim of legal professional privilege is established.

Documents 2-4

Submissions

119    As noted above, each of these documents comprise emails sent by Mr Coulthart to the applicant’s lawyers and others, which are said to be for the purposes of obtaining legal advice in relation to the content of draft media statements.

120    The draft media statements were prompted by the publication of media articles by the respondents attacking the applicant’s reputation and these were protective of the applicant’s reputation. It was submitted that Mr Coulthart, who assisted the applicant to prepare media statements, sent them to the applicant’s lawyers on his behalf for review and comment before those statements were released. It was submitted that Mr Coulthart’s evidence is that the main reason he sent the emails was to obtain legal advice from the applicant’s lawyers. The advice sought was of a presentational nature, how best to defend his reputation in response to continuing defamatory attacks in circumstances where he had commenced proceedings and may be required to appear before the Inquiry and to avoid any risk of commenting inappropriately on the subject matter of the Inquiry or matters that may impact upon his defamation proceedings as well as to avoid the risk of defaming others. Mr Coulthart communicated directly with the applicant’s lawyers to obtain legal advice; in so doing, he acted as a conduit for the receipt of that advice. It was submitted that those communications fall within the first category identified by Lockhart J at 245 in Sterling.

121    It was submitted that privilege was not waived by copying the following persons to the emails; Mr Stokes and Mr McWilliam (Documents 2 and 3) and Ms Cato (Document 4). Each of these persons had a common interest in sharing the privileged communications, citing Cygnett at [13]. In relation to Mr Stokes and Mr McWilliam, the applicant’s reputation was a matter that could impact upon SWM’s corporate reputation and SWM was providing legal funding to the applicant. Ms Cato was the principal of the firm at which Mr Coulthart was employed, which was providing public relations advice to the applicant. An implied obligation of confidence arose among the recipients of Mr Coulthart’s communications by reason of the fact that they contained draft statements and were sent to the applicant’s lawyers after proceedings had commenced, citing Cygnett at [24].

122    The respondents submitted that first, the draft media statements were not created for the dominant purpose of seeking legal advice; they were created with the aim of being released publicly to protect the applicant’s reputation. An intermediate step prior to release may have been to obtain legal advice or the input of third parties, such as Mr McWilliam and Mr Stokes. However, that does not mean that the drafts were created for the dominant purpose of undertaking those intermediate steps, citing AWB (No 5) at [112]. Second, the draft statements were emailed to a group of individuals for input on those intermediate steps prior to publication. Consistent with the Court’s conclusion in AWB (No 5) at [114], the evidence does not establish that obtaining legal advice was the dominant purpose of these emails. The evidence instead shows that both intermediate steps (legal advice and third-party input) were pursued in a single email addressed to both the lawyers and third parties. In those circumstances, neither purpose was dominant.

Consideration

123    This challenge is to the emails sent by Mr Coulthart, seeking legal advice in respect to draft media statements. This in a context where emails from the applicant’s lawyers to Mr Coulthart, which include legal advice in relation to the content of draft media releases (Documents 5, 7 and 8) are now accepted by the respondents to be privileged.

124    This is also in a context where the Inquiry was ongoing and the applicant may have been required to appear, and the defamation proceedings had been instituted. The particular context takes it outside what might ordinarily be associated with a media release. In that context, it appears an obvious topic on which to obtain legal advice before anything is published. Indeed, so much must be accepted by the respondents as they do not challenge the emails from the applicant’s lawyers providing advice.

125    In any event, the documents sought by the subpoena are three emails. The parties addressed them as a group and did not suggest any distinction could be drawn between them. Although the advice sought related to the draft media statements the content of which was provided, it is the emails that are caught by the subpoena.

126    Mr Coulthart gave evidence that draft media statements are treated by him as confidential, as was the email correspondence. The evidence is that is how the emails were treated. Given the limited distribution, to whom they were distributed (see for example Network Ten at 286), and the content and purpose of the emails, I accept the applicant’s submission that there was at least an implied obligation of confidentiality.

127    In the oft cited case of Sterling, the first class of documents which attract privilege, referred to by Lockhart J at 245, is as follows:

Any communication between a party and his professional legal adviser if it is confidential and made to or by the professional adviser in his professional capacity and with a view to obtaining or giving legal advice or assistance; notwithstanding that the communication is made through agents of the party and the solicitor or the agent of either of them. See Wheeler v. Le Marchant (1881) 17 Ch D 675; Smith v. Daniell (1874) LR 18 Eq 649; Bullivant v. Attorney-General for Victoria (1901) AC 196; Jones v. Great Central Railway Co. (1910) AC 4, and O'Rourke v. Darbishire (1920) AC 581. 

128    Mr Coulthart, who assisted the applicant to prepare the draft media statements, sent these three emails to the applicant’s lawyers seeking legal advice from them as to their contents. No other purpose is suggested. In those circumstances, Mr Coulthart’s communication with the applicant’s lawyers by these emails is the subject of legal professional privilege.

129    Again, I have looked at Documents 2-4, which confirms my view as to that conclusion.

130    I am satisfied that in relation to Documents 2-4, the claims of legal professional privilege have been established.

Conclusion

131    For the above reasons, the applicant has established his claim for legal professional privilege in respect to Documents 1-4. Accordingly, the respondents’ application is dismissed.

Associate:

Dated:    23 November 2021

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