Federal Court of Australia

Yong v Westpac Banking Corporation [2025] FCA 816

ORDERS

THE COURT ORDERS THAT:

1. The orders of Registrar Legge dated 8 November 2024, amended 20 November 2024, be set aside.

2. The application for production of documents filed on 4 June 2025 is dismissed.

3. By 7 days from the date of judgment, the parties are to file submissions (no longer than three pages) on the appropriate order as to costs.

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

REASONS FOR JUDGMENT

BENNETT J:

Introduction

1 This is an application by Westpac Banking Corporation (Westpac, or the Respondent) for review under s 35A(6) of the Federal Court of Australia Act 1976 (Cth) (FCA Act) of a decision of a Registrar of this Court to allow the Applicant’s application, dated 4 June 2024, seeking production of certain discovered documents.  Production is resisted on the basis that the documents in question are subject to a valid claim of legal professional privilege.  14 documents remain in contention (the Disputed Documents).  An application of this kind proceeds as a hearing de novo.  I am therefore not concerned with the correctness of the Registrar’s decision, or redressing error, nor is there any legal or evidentiary significance to be attached to the manner in which the original application proceeded before the Registrar.  In this application, I hear the case unaffected by what has gone before and determine the application afresh (Lee v Dentons Australia Limited [2024] FCA 622 at [3] (Cheesman J)).

2 For the reasons set out in detail below, I have concluded that the evidence establishes that:

(1) The dominant purpose for the creation of the Disputed Documents was the provision of legal advice and responding to the statement of claim filed in legal proceedings. The Disputed Documents attracted legal professional privilege at the time of their creation.

(2) The privilege which subsisted in the Disputed Documents was not waived by their subsequent provision to two third parties on a confidential basis for a limited and specific purpose.

3 It follows from these conclusions that the Disputed Documents are properly the subject of a claim for legal professional privilege, and the application for production will therefore be dismissed.

background

4 The present case is a representative proceeding commenced on behalf of, broadly, persons who acquired an interest in Westpac securities in a particular period.  By the proceeding, the class members seek declarations and damages in respect of alleged breaches of the ASX Listing Rules, Corporations Act 2001 (Cth), Australian Securities and Investments Commission Act 2001 (Cth) and the Australian Consumer Law (being Schedule 2 to the Competition and Consumer Act 2010 (Cth)).  Those alleged breaches substantially arise from matters that were ventilated in the course of an investigation commencing in or around November 2018 by the Australian Transaction Reports and Analysis Centre (AUSTRAC).  That investigation (the AUSTRAC Investigation) concerned Westpac’s compliance with certain aspects of the Anti-Money Laundering and Counter-Terrorism Financing Act 2006 (Cth) (AML/CTF Act).

5 The AUSTRAC Investigation led to the commencement of civil penalty proceedings by AUSTRAC against Westpac (the AUSTRAC Proceeding).  The originating application and statement of claim in the AUSTRAC Proceeding were filed on 20 November 2019, while a defence was filed on 15 May 2020.  The AUSTRAC Proceeding was resolved on the basis of an agreed position, reflected in the decision of this Court on 21 October 2020 (Chief Executive Officer of the Australian Transaction Reports and Analysis Centre v Westpac Banking Corporation [2020] FCA 1538).

6 Certain, uncontroversial aspects of the evidence can be summarised as follows.

7 The AUSTRAC Proceeding involved alleged (and later admitted) failures by Westpac to report to AUSTRAC International Funds Transfer Instructions (often called IFTIs in the evidence discussed below), retain records, and implement appropriate correspondent banking due diligence procedures.

8 The facts underpinning the AUSTRAC Proceeding were not only complex; they were of fundamental importance to Westpac.  A range of reviews and responses followed the commencement of the AUSTRAC Proceeding.

9 Westpac issued a release to the Australian Securities Exchange (ASX) the day the statement of claim in the AUSTRAC Proceeding was filed, acknowledging the commencement of the AUSTRAC Proceeding.

10 Allens were engaged to assist Westpac in responding to the AUSTRAC Investigation and then the AUSTRAC Proceeding.  Within 48 hours of receiving the statement of claim, Allens received instructions to commence work on chronological summaries of factual matters to assist Westpac to evaluate the allegations in the statement of claim, in order to develop the responses that would constitute its defence (each a Chronology, and together the Chronologies).

11 In its press release of 22 November 2018, Westpac made clear that it was “establishing a multi-layered review” which included “accelerating [its] ongoing program of AML/CTF improvements”.  The press release also announced that Westpac would:

…appoint independent experts to oversee the program including a review of accountability. We will take actions emerging from that review. An assessment of suitably qualified candidates to lead that review is underway.

12 On 24 November 2019, Westpac released a copy of its “response plan” and said that it had commenced work on an independent review (Response Plan).  In the Response Plan, Westpac accepted that it had fallen short of its own, and regulatory, expectations and that “…a detailed review is required to investigate the facts alleged by AUSTRAC”. The Response Plan adopted a range of headings, being:

(1) “Immediate fixes” that were largely immediate operational steps that Westpac proposed to take or had taken to respond to immediate account or resourcing issues.

(2) “Lifting our standards”, which included the engagement of an external expert.  The expert would be commissioned to “independently review Westpac’s program including a review of accountability, and report back”.

(3) “Protecting People”, which listed forward funding initiatives for child protection and prevention of child exploitation.

13 The Response Plan also foreshadowed “engaging various external consultants and advisors to perform assurance reviews over aspects of the Group’s financial crime processes and to advise on changes to its program and approach”.

14 From 25 November 2019, Mr Richard Glenn Harris, a partner of Gilbert + Tobin, was engaged to provide legal assistance and advice to Westpac in connection with some issues arising following the commencement of the AUSTRAC Proceeding.

15 Westpac issued a further announcement to the ASX on 25 November 2019 in which it referred to its Response Plan.

16 On 26 November 2019, Westpac announced to the ASX that there would be a number of executive changes, and identified the Response Plan as an immediate priority.

17 On 28 November 2019, Westpac announced that Promontory had been appointed to undertake the “External Accountability and Financial Crime Program Review” outlined in the Response Plan.  Westpac also announced the review to be carried out by the Advisory Panel.  The first two members of the Advisory Panel were announced on 20 December 2019, and were Dr Ziggy Switkowski AO and Dr Kerry Schott AO.  The final member, Mr Colin Carter AM, was appointed on 16 January 2020.

18 Promontory Australasia (Sydney) Pty Ltd had a Master Services Agreement with Westpac dated 1 March 2010 (the MSA).  The MSA provided for work to be carried out based on individual statements of work.  The MSA was novated to IBM Australia Ltd on 1 August 2019.  Promontory Australia was at that time a business unit of IBM Australia Ltd, and it was this part of IBM Australia Ltd that was engaged to carry out the review.  For simplicity, I refer to this entity as Promontory.  On 16 December 2019, a Statement of Work Services was executed pursuant to which Promontory carried out the review.  The services to be provided under the Statement of Work Services consisted of three parts, which can broadly be described as:

(1) Part I: External assurance to the Westpac Board over the design effectiveness of Westpac’s Financial Crime Strategic Plan.

(2) Part II: External assurance to the Westpac Board over the design effectiveness of Westpac’s program of work to implement that plan, and delivery of a robust assurance framework via which Westpac or a third party could monitor the ongoing implementation of that plan.

(3) Part III: External assurance to the Westpac Board that Westpac’s management review of accountability for the failings identified in the statement of claim in the AUSTRAC Proceeding, performed under Westpac’s standard internal governance process, is robust, based upon an accurate and complete set of facts, and employed a sound methodology for arriving at its conclusions.

19 The Statement of Work Services also noted that in conducting its engagement Promontory would:

1. Review the fact base prepared by Allens in the course of responding to the AUSTRAC allegations.

…

4.     Review the fact base prepared by Allens or materials otherwise required to enable [Promontory] to understand and assess the current state of the AML/CTF framework including [the processes and other aspects of the framework described in the Statement of Work Services].

20 Each part of the Statement of Work Services included detail as to how the work was to be undertaken which I have not extracted here.  It also included terms as to confidentiality.  The Promontory engagement was supplemented on 3 June 2020 by a variation which added to the obligations of Promontory under the MSA with respect to its treatment of confidential information in relation to the Statement of Work Services.

21 Each member of the Advisory Panel was individually appointed.  The engagement was formalised for Dr Switkowski and Dr Schott on 18 December 2019 and for Mr Carter on 16 January 2020.  The terms of their appointment were relevantly identical including the following elements:

(1) The Advisory Panel would “…provide recommendations on governance and Board accountability in relation to matters raised by AUSTRAC in its Statement of Claim”.  It was also noted that the work would be carried out under such terms of reference that would be subsequently agreed.

(2) Each engagement letter contemplated the provision of confidential information to be used only for the purposes of performing their role as a member of the Advisory Panel.

(3) Each engagement letter made clear that any reports of the Advisory Panel “may be made available to regulators, and more broadly to the public as Westpac determines”.

22 The terms of reference that were ultimately provided to the Advisory Panel asked it to answer two questions:

1. Were the formal Board processes, including information flows, adequate to ensure informed oversight of compliance with the requirements of the Anti-Money Laundering and Counter-Terrorism Financing Act 2006 (Cth); and

2. Was the level of due diligence exercised by the Directors within these processes appropriate?

23 While both engagements had different functions, there was a strong link between the work being carried out by both Promontory and the Advisory Panel on the one hand, and the failings identified by AUSTRAC on the other.  The Applicant emphasises this link: submitting that the AUSTRAC Proceeding (and therefore AUSTRAC’s statement of claim) underpinned much of the work that was being carried out by Promontory and the Advisory Panel.

24 The first Chronology was finished by Allens and provided to Westpac on 24 December 2019.

25 It was provided to each of the Advisory Panel and Promontory on or about 4 January 2020.  This was done by uploading the Chronology into a shared database (referred to as the Shield Docs repository).  The email from Mr Leif Evensen (General Manager, AUSTRAC Response Secretariat to the Westpac internal legal team) notifying the Advisory Panel that the documents had been uploaded stated:

We have loaded into the Shield Docs repository an initial fact base/chronology (CSE Transaction monitoring fact base) prepared by Allens, which is being shared with you and  Promontory in relation to your respective scopes of work. This document can be found in the “Fact base” folder. Additional fact bases will be made available as they are completed.

The chronology/fact bases are subject to legal professional privilege and are being provided on the basis that they will be treated with strict confidentiality and not inconsistently with Westpac’s ability to maintain privilege over them, including sharing with third parties.

26 On the same day the Promontory team also received an email notifying them that the Chronologies had been provided on the shared database.  That email contained the same paragraph regarding confidentiality and the maintenance of privilege.

27 Most of the balance of the Chronologies were provided to Westpac by Allens on 7 February 2020.  It appears that the Chronologies were uploaded to Shield Docs on or around 15 February 2020.  Promontory accessed the Chronologies through the Shield Docs platform.  By contrast, the Advisory Panel received emails from Mr Evensen attaching the Chronologies.  For example, on 15 February 2020, Mr Evensen emailed the Advisory Panel in the following terms:

Please find attached short chronologies for the following IFTI-related matters:

* SCB and Citibank IFTI non-reporting

* Deutsche Bank IFTI non-reporting

* Wells Fargo IFTI non-reporting

* PayPal IFTI non-reporting

* SCB outgoing IFTI non-reporting

* Failure to pass on required information

* Record keeping

The LitePay IFTI non-reporting chronology is being finalised, but Allens has noted that the non-reported LitePay IFTIs comprise only a very minor fraction of the total unreported IFTIs, and that the details of this non-reporting are not necessary to understand the other chronologies (which stand on their own).

Ziggy, regarding the “what exactly went wrong” IFTI question, the SCB and Citibank IFTI non-reporting document covers this in a non-analytical way – i.e, factual description using available data, without speculation as to why (which is the remit of the root-cause team that is informing the management accountability assessment).  Structured files (received from various banks in variable formats were to be received by a system called WIBS, converted (using bank-specific “IFTI converters”) to a standard format suitable to draw on for reporting to AUSTRAC, and stored in a dedicated directory within WIBS for access by the Norkom / Detica system that extracts the IFTI data and generates the AUSTRAC reporting.  The Norkom / Detica reporting did not pick up all IFTIs because not all the data pertaining to in-scope banks had been converted and stored in the WIBS directory as required. I’ll leave it to the Panel to make any inferences that it wishes to make regarding the potential contribution of factors such as project management (scope management, testing, post-implementation verification, etc.) to that situation.

I will text the password and, as with last night’s documents, will arrange for the usual password to be applied when I’m back in the office.

28 The covering email provides some insight into the way in which the Chronologies were to be used by the Advisory Panel: that is, they provided a non-analytical description of events without speculation as to why those events occurred.

29 The application of a password is relevant to the issue of confidentiality, to which I will return.

30 A Chronology of the Board’s oversight activities since March 2013 was provided to Westpac by Allens on 11 February 2020.  It was provided to the Advisory Panel on 19 February 2020.

31 The “Correspondent Banking chronology” was provided to Westpac by Allens on 19 February 2020 and then to the Advisory Panel by email on 27 February 2020.  The covering email noted that the document had “the usual password”.

32 The final Chronology, described as “LitePay – IFTI non reporting” was provided by Allens to Westpac on 4 March 2020, and provided to the Advisory Panel on 3 April 2020.  The covering email from Mr Evensen noted that it was provided to “round out the fact base for your work”.

33 Promontory provided its assurance letter on 27 May 2020.  This was the conclusion of its engagement.  The letter is two pages long.  It noted that all materials shared with Promontory for the purpose of its assurance work were provided on a confidential basis and that:

The need to preserve legal privilege over some of the materials involved meant that our access to parts of the Review was even further limited.

34 The assurance letter included the observation that:

Our assurance activities, which ran for a period of around five months, included reading and assessing documents, including vast quantities of documents made available by Westpac, relevant Westpac policies, procedures and frameworks, Management and Board Committee papers, and a methodology document compiled by the Review Team.

35 Promontory’s assurance was ultimately a fairly limited negative assurance.  One of the assurances provided was in the following terms (emphasis original):

Given our lack of visibility over the conclusions and recommendations made by the Review Team, Promontory is only able to provide negative assurance over these. Specifically, we saw no reason why the methodology, if implemented as designed, should not lead to accurate and appropriate conclusions and recommendations.

36 The Advisory Panel completed its work and delivered its report on 4 June 2020.  That report observed that its task was “not to interrogate specific AUSTRAC allegations…”.  This is borne out by a review of the report.  The process undertaken by the Advisory Panel is summarised in Appendix D to its report, including the following:

Over a four-month period, Panel members have:

* Reviewed relevant literature on governance of financial institutions especially the CBA Prudential Enquiry (May 2018), the Westpac Culture, Governance and Accountability Self-Assessment (November 2018), the ASIC Corporate Governance Task Force Report (October 2019) and the APRA Banking Executive Accountability Regime (February 2018).

* Reviewed Board and Board Committee documents, and extracts of documents, for the 2013-2019 period.

* Interviewed the Chairman (outgoing and incoming), CEO (former and current), and each current Non-Executive Director listed below.

* Interviewed senior Westpac executives, listed below, with connection to non-financial risk and specifically financial crime.

* Reviewed information on critical Financial Crime events at offshore banks.

The Panel interviewed the following current and former Westpac Non-Executive and Managing Directors: …

Several Westpac Executives and the external Auditor were also interviewed: …

The focus of our investigation has been narrow and we have not interviewed people outside Westpac (except as noted above).

The Panel was assisted in their work by a Secretariat and we would like to particularly thank John Arthur, Leif Evensen and Stephanie Gray for their expert assistance.

37 The Disputed Documents may be broadly described as:

(1) Chronologies: 11 chronological summaries of factual matters prepared by Allens relating to the AUSTRAC Proceeding.  The Chronologies were provided to the Advisory Panel and Promontory and used by the external parties in the manner described above, and analysed in further detail below.

(2) Notes: Two notes prepared by Allens, titled “Overview of AUSTRAC claims against Westpac regarding alleged contraventions of the AML/CTF Act” (the First Note) and “Privileged and confidential – Preliminary outline of facts – IFTI non-reporting” (the Second Note) dated 16 December 2019 and 16 February 2020 respectively (together, the Notes).  These were sent to the Advisory Panel but not Promontory.

(3) Summary: One summary document prepared by the AUSTRAC Response Secretariat Team for the Advisory Panel, in relation to which the Respondent seeks redactions of extracts of one of the Chronologies (the Summary).  A second summary was at issue before the Registrar, but Westpac have now consented to its unredacted production.

38 Westpac submitted that the Disputed Documents were confidential communications for the sole (or alternatively dominant) purpose of litigation or legal advice.  Westpac relied upon two affidavits of Mr Richard Harris dated 28 November 2024 and 28 February 2025.  The first is largely formal.  The second affidavit, of 28 February 2025 (the Harris Affidavit), is more substantive.  Mr Harris is a partner at Gilbert + Tobin.  In 2019, he was engaged by Westpac to assist in responding to issues concerning the AUSTRAC Proceedings, and he had a role in coordinating the various legal workstreams.  In the Harris Affidavit, he explained his engagement in the following way:

As part of this engagement, I provided legal advice to Westpac in relation to the workstreams that were being conducted by other external law firms in defence of the AUSTRAC Proceeding and was involved in discussions with Westpac Executives, Westpac’s then General Counsel, other members of Westpac’s internal legal team and lawyers from external law firms in relation to those workstreams.

39 The Applicant relied upon the affidavit of Mr Joel Phibbs dated 24 March 2025, a Principal Lawyer of Phi Finney McDonald, the solicitors for the Applicant (the Phibbs Affidavit).

40 It is clear that at some point after the request was made to Allens to create the Chronologies, but before they were communicated, a decision was made to share them with Promontory and the Advisory Panel.  It is this decision, and its impact on the purpose for which the Chronologies were created, that is at the core of the present dispute.  To determine this dispute, it is necessary to first canvass the relevant legal principles.

Legal principles

General

41 The dispute relates to pre-trial disclosure and not the adducing of evidence.  It therefore falls to be determined by reference to common law principles (Singtel Optus Pty Ltd v Robertson [2024] FCAFC 58 (Robertson) at [24] (Murphy, Anderson and Neskovcin JJ)).  There are two limbs to the privilege, often referred to as litigation privilege and advice privilege.  While nothing turns on the distinction in this case, Westpac asserts that all documents attract both limbs of the privilege, and neither has been waived by any subsequent actions.

42 Legal professional privilege is a rule of substantive law, and not merely of evidence (TerraCom Ltd v Australian Securities and Investments Commission [2022] FCA 208; 401 ALR 143 at [35] (Stewart J) and the authorities there cited).  It reflects the balance that has been struck between the public interest in full disclosure of all available and relevant information in pursuit of the administration of justice, and the public interest in maintaining confidentiality in communications which assist and advance the administration of justice by encouraging and supporting the obtaining of legal advice with all necessary candour (Cantor v Audi Australia Pty Ltd [2016] FCA 1391 (Cantor) at [56] (Bromwich J)).  The relevant principles are not in dispute, and were helpfully summarised by the Full Court in Robertson at [23]–[32].

43 Litigation privilege arises in respect of confidential communications for the dominant purpose of use in or in relation to legal proceedings – either ongoing, pending or anticipated (Australian Competition and Consumer Commission v NSW Ports Operations Hold Co Pty Ltd [2020] FCA 1232 (NSW Ports) at [41] (Wigney J) and the cases there cited).  Advice privilege arises where there is a confidential communication for the dominant purpose of obtaining or giving legal advice (Cantor at [62] (Bromwich J) and the cases there cited).  Legal advice includes advice about what a client should prudently or sensibly do in the legal context in which the issue has arisen (Cantor at [62]).

44 Confidentiality is a key ingredient to a claim of legal professional privilege under either limb (NSW Ports at [46]).

45 Of particular relevance to the present case are the following propositions:

(1) The purpose for which a document was created is a matter of fact to be determined objectively, having regard to the evidence, the nature of the document, and the parties’ submissions (Robertson at [25]).  It follows that evidence of the intention of the document’s maker or the person who procured the document is not necessarily conclusive (AWB Ltd v Cole [2006] FCA 571; 152 FCR 382 (AWB v Cole) at [110] (Young J) and the cases there cited).

(2) Focused and specific evidence is needed to establish the dominant purpose (Asahi Holdings (Australia) Pty Ltd v Pacific Equity Partners Pty Ltd (No 4) [2014] FCA 796 (Asahi) at [29] (Beach J); Robertson at [25]).

(3) The nature and extent of the evidence needed to prove the existence of privilege is fact and circumstance dependent (Robertson at [25]).  Dominance of purpose is not established by bare ipse dixit (Robertson at [29]).

(4) The existence of privilege will not “necessarily or conclusively [be] established by resort to any verbal formula or ritual” (NSW Ports at [49], quoting Grant v Downs (1976) 135 CLR 674 (Downs) at 689).  A bare claim of an opinion that privilege arises will be insufficient where it is unsupported by evidence.

(5) It is not sufficient to show a substantial purpose or that the privileged purpose is one of two or more purposes of equal weighting; rather it must be predominant and be the paramount or most influential purpose (Robertson at [27]).

46 It was submitted by the Applicant, and I accept, that a court is not obliged to accept evidence of state of mind merely because it is asserted, and nor is it obliged to find evidence to be persuasive irrespective as to challenge by cross-examination, particularly where it is contradicted by facts otherwise established by contemporaneous material (Robertson at [32], citing Precision Plastics Pty Limited v Demir (1975) 132 CLR 362 at 370-371 (Gibbs J, with whom Stephen J agreed, and Murphy J generally agreed).

47 In Mitsubishi Electric Australia Pty Ltd v WorkCover Authority (Vic) [2002] VSCA 59; 4 VR 332 (Mitsubishi Electric) Batt JA noted at [14] (Charles and Callaway JJA concurring) that “[o]rdinarily the purpose will be that of the maker of the document, but that will not always be the case…”.

48 The dominant purpose has been described in a number of ways: it is one that “predominates over other purposes; it is the prevailing or paramount purpose” (AWB v Cole at [105]).  In Federal Commissioner of Taxation (Cth) v Pratt Holdings Pty Ltd [2005] FCA 1247; 225 ALR 266 (Pratt Holdings), Kenny J explained (at [30(7)], citations omitted):

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 documents was contemplated at the time.

49 When applying the dominant purpose test, a useful starting point is to ask 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; 136 FCR 357 (Pratt Holdings v Commissioner of Taxation) at [35] (Finn J), cited in AWB v Cole at [107]).  In Asahi at [33] Beach J said that:

One practical test is to ask whether the communication would have been made (whether the document would have been brought into existence) irrespective of the obtaining of legal advice. If so, the communication (document) may not satisfy the dominant purpose test. Such a test will entail addressing the question of the intended use(s) of the document which accounted for it being brought into existence.

50 I accept the Applicant’s submission that it is possible for the purpose to shift between the time of commissioning and the time of communication, and that it is the purpose at communication which must be assessed (AWB v Cole at [111]; Barnes v Commissioner of Taxation [2007] FCAFC 88; 242 ALR 601 at [6] (Tamberlin, Stone and Siopis JJ); Singapore Air v Sydney Airports Corporation & Anor [2004] NSWSC 380 at [21] (McDougall J); Spotless Group Ltd v Premier Building & Consulting Pty Ltd [2006] VSCA 201; 16 VR 1 at [68] (Neave JA)).  However, the purpose for which the document was commissioned may well be relevant to determining the purpose at the time of the communication.   This is a question of fact to be determined in the circumstances of each individual case.  Of course, it may be that the subsequent use may point to a purpose in creation that was equal or greater than the purpose of providing advice or assistance in litigation.  If that were so, the party asserting the privilege would fail to establish it (Cantor at [68]).

The Chronologies: analysis

51 I have analysed each category of documents, as well as considered each document separately.  I have inspected the documents with the consent of the parties.  My analysis of each category of document and, where appropriate, each document, is based on the principles and facts set out above.

52 At the core of this case is the question of whether or not the dominant purpose of the Chronologies changed from the purpose at the time of their commissioning by the time of their communication.  The Applicant argues that:

(1) at all relevant times, Westpac had multiple purposes for the Chronologies, which included non-privileged purposes;

(2) the evidence adduced concerning Ms Lim and Ms Rogers is inadequate to establish that the dominant purpose for the Chronologies was privileged;

(3) Westpac failed to adduce evidence from any key persons involved in the decision to provide the Chronologies to the Advisory Panel and Promontory for non-privileged purposes; and

(4) therefore, the evidence adduced is inadequate to establish that the dominant purpose was privileged.

53 Westpac asserts that there was no relevant change to the dominant purpose despite the decision to provide the Chronologies to the Advisory Panel and Promontory.  It relies on three types of evidence to establish dominant purpose to the relevant standard:

(1) First: evidence of the circumstances and context in which the communications occurred, or the documents were brought into existence (Cantor at [69], quoting AWB Ltd v Cole (No 5) [2006] FCA 1234; 155 FCR 30 (AWB (No 5)) at [44(1)]).  In the present application, Westpac argue that the timing of the Chronologies in relation to the statement of claim in the AUSTRAC Proceeding, and the need to prepare a defence within a particular timeframe, is part of understanding the purpose.

(2) Second: evidence as to the purposes of those who procured the creation of the documents.  In this application, that is the evidence of Mr Harris given on information and belief of the in-house lawyers at Westpac who commissioned the Chronologies, and one of the Allens lawyers involved in their preparation.

(3) Third: the nature of the documents themselves.

54 The bulk of Westpac’s evidence is given via the Harris Affidavit. That affidavit includes a substantial portion of hearsay evidence from the following individuals:

(1) Ms Caroline Rodgers, a lawyer employed by Westpac who currently holds the title of “General Counsel – Litigation, Regulatory Investigations and Financial Crime”.  From April 2019, Ms Rodgers’ role at Westpac was “Head of Regulatory Investigations and Litigation”.  From that time, she, along with others, was involved in the management of Westpac’s response to the AUSTRAC Investigation and Westpac’s defence of the AUSTRAC Proceeding.  By December 2019, Ms Rodgers’ role was “Head of Legal – AUSTRAC Matter”.  In that role, she was responsible for supervising the internal team of lawyers managing Westpac’s defence of the AUSTRAC Proceeding and related matters and the engagement with Westpac’s external legal representatives (including Allens).

(2) Ms Rebecca Lim, Group General Counsel at Westpac and its Chief Legal Officer in late 2019.  Ms Lim has since left employment with Westpac.

(3) Mr Christopher Kerrigan, a partner at Allens who was one of the partners responsible for supervising the team of Allens lawyers who provided legal advice and assistance including in relation to the defence to the statement of claim in the AUSTRAC Proceeding.

55 There is very limited hearsay evidence from Ms Kylie Gray, who was Westpac’s “General Counsel, Major Regulatory Investigations and Litigation” in the relevant period.  Ms Gray has since left employment with Westpac.

The evidence concerning Ms Lim and Ms Rodgers

56 Mr Harris gives evidence about what Ms Rodgers and Ms Lim each told him about their involvement in the preparation of the Chronologies.

57 Ms Rodgers says that she was part of the discussions in which Westpac instructed Allens to conduct factual investigations and prepare Chronologies of issues within the AUSTRAC statement of claim for the purpose of Westpac being provided with legal advice.  Mr Harris deposes that Ms Rodgers told him that:

(1) Her discussions with Allens were solely concerned with Westpac’s defence of the AUSTRAC Proceeding and that no purpose for instructing Allens to carry out the work in question was discussed other than a legal purpose.  She was substantially involved in the day to day interactions with Allens while carrying out that work, and so far as she was aware, the only purpose for the work carried out by Allens was analysing the AUSTRAC statement of claim and preparing the Chronologies to provide legal advice and assistance to Westpac in relation to its defence of the proceedings.

(2) She did not discuss with anyone or observe anyone to say that the work was to be conducted for a different or additional purpose.  No other purpose was discussed in meetings between Westpac and Allens, or internal meetings at Westpac which Ms Rodgers attended.

(3) She did not “discuss or hear any person mention that the purpose for the preparation of the chronologies had changed at any other time”.

(4) In her opinion, the decision to provide the Advisory Panel with the Allens Chronologies did not alter the fundamental purpose for which they were being prepared.

(5) Regarding her understanding of the purpose:

Neither at the time that decision [to provide the Chronologies to the Advisory Panel and Promontory] was conveyed to her, nor at any other time, was she informed or did she come to understand that the purpose for the preparation for the Allens Chronologies had changed or that there were other additional purposes for that work, only that, once complete, copies of those documents might also be provided to the Advisory Panel and to Promontory on a confidential basis which they could use, if they assisted, as an aide in the conduct of their respective tasks.

58 Mr Harris gives evidence that he was told by Ms Lim that upon receipt of the statement of claim in the AUSTRAC Proceeding, she quickly formed the view that it would be necessary to have a detailed analysis of the allegations contained in the statement of claim, including a Chronology of events relevant to each key alleged source of contravention.  This was so that Westpac could obtain legal advice and assistance in relation to its response to the allegations and any defence that Westpac would file, and facilitate the provision of legal advice and assistance to Westpac and the Board in relation to its general response to the proceeding and any ancillary legal processes that might ensue from the AUSTRAC Proceeding (such as regulator inquiries or third party litigation).  She instructed Mr Haig of Allens to commence work on the Chronologies in relation to the matters the subject of those allegations on the date of receipt of the statement of claim, without being aware of the proposed engagement of Promontory or the Advisory Panel.  In addition, Ms Lim told Mr Harris that:

(1) Some days later, she became aware that the Westpac Board determined to appoint the Advisory Panel.  Some days after that time, a request was made by Mr Evensen as to whether there were any materials that the legal team held that he could obtain copies of to provide the Advisory Panel and Promontory as to assist them with understanding the factual background.

(2) Mr King agreed that once the Chronologies were completed, copies could be provided to the Advisory Panel and Promontory on a confidential basis to assist them with their reviews.

(3) Ms Lim believed that the decision to allow the Advisory Panel and Promontory to review copies of that material did not in any way alter the purposes in requesting the material.

(4) She did not instruct Allens, nor did she instruct any lawyer in her team to instruct Allens, that the purpose for the work had changed or that there was now an additional purpose for the work.

(5) In Ms Lim’s view, but for the need to have the Allens Chronologies prepared for the purpose of Westpac receiving legal advice in relation to the AUSTRAC Proceeding, she would not have sought that highly detailed work be conducted over a number of months.

59 It is said by the Applicant that the evidence about what was said by Ms Rodgers and Ms Lim reflects their subjective intentions as lawyers, but is inadequate to establish Westpac’s dominant purpose, particularly having regard to the hearsay and conclusory nature of their evidence and their lack of involvement in Westpac’s non-privileged workstreams.  The criticism focuses upon the evidence about Ms Rodgers’ belief summarised at [57(5)] above and Ms Lim’s belief at [58(3), (4) and (5)].

60 In criticising Westpac’s reliance upon hearsay, the Applicant refers to the following statement of Brereton J in Hancock v Rinehart (Privilege) [2016] NSWSC 12 (Hancock) at [7]:

To sustain a claim of privilege, the claimant must not merely assert it; but must prove the facts that establish that it is properly made. Thus a mere sworn assertion that the documents are privileged does not suffice, because it is an inadmissible assertion of law; the claimant must set out the facts from which the court can see that the assertion is rightly made [Gardner v Irvin (1878) LR 4 Ex D 49, 53], or in other words "expose … facts from which the [court] would have been able to make an informed decision as to whether the claim was supportable" [National Crime Authority v S (1991) 100 ALR 151, 159 (Lockhart J)]. The evidence must reveal the relevant characteristics of each document in respect of which privilege is claimed [Lazenby v Zammit [1987] Tas R 54, 56 (Green CJ and Wright J); see also Attorney-General for Northern Territory v Kearney (1985) 158 CLR 500, 508 (Gibbs CJ); Holmes v Deputy Commissioner of Taxation (1987) 19 ATR 1278, 1286 (Davies J)], and must do so by admissible direct evidence, not hearsay [Commissioner of Australian Federal Police v Propend Finance Pty Ltd (1997) 188 CLR 501, 513-4 (Brennan CJ)].

61 Westpac submit that the reference to a requirement that evidence should not be hearsay is to be understood as “inadmissible hearsay”, pointing to the cases of In the matter of Northern Energy Corporation Ltd [2020] NSWSC 1073 at [72] (Rees J); Re Global Advanced Metals Pty Limited [2019] NSWSC 1545 at [16]-[17] (Rees J); Carna Group Pty Ltd v The Griffin Cola Mining Company (No 2) [2019] FCA 2209 at [13] (McKerracher J); Tavcol Pty Ltd v Valbeet Pty Ltd [2016] NSWSC 1002 at [36]-[37] (McDougall J); Racing New South Wales v Racing Victoria Ltd [2024] NSWSC 147 at [132] (Rees J); Aquasure Pty Ltd v Thiess Pty Ltd (No 2) [2022] VSC 389 at [22] (Steffensen AsJ).  I note that Brereton J separately refers to “inadmissible hearsay” when summarising his conclusions as to the availability of hearsay in Hancock (at [35(2)]).

62 The Applicant’s submissions accept that “hearsay evidence is admissible on this application”.  That position is consistent with s 75 of the Evidence Act 1995 (Cth) and the comments of the Full Court in Robertson (at [63], extracted below).  If it were not so, it would remove some of the flexibility to deal efficiently with matters of an interlocutory nature in the way contemplated by ss 37M and 37N of the FCA Act.  However, the authorities support and are consistent with the repeated exhortation that a claim for privilege must be supported by “focused and specific evidence” (Asahi at [29] (Beach J)).

63 Instances like those in Robertson, where the primary judge found that the evidence was “pregnant with imprecision” and that it was of a “superficial” quality (referred to by the Full Court at [55(c)]) will be insufficient.  It was in the context of those criticisms that the Full Court noted that (at [63]):

…not only did Optus not put on direct evidence from Ms Bayer Rosmarin or any Board member, Mr Kusalic’s evidence did not even provide hearsay evidence, on the basis of information and belief, as to Ms Bayer Rosmarin’s state of mind, or as to the state of mind of the Board members to the extent that he talked to them. Such evidence would have been admissible: s 75 of the Evidence Act 1995 (Cth).  Evidence as to their state of mind was critically relevant once it is appreciated that the media release and the circular resolution showed the existence of non-legal purposes for procuring the Deloitte Report.

64 It is significant that the Full Court in Robertson recognised that the failure to “even provide hearsay evidence” was adverse to the privilege claim by Optus.

65 The case of Australian Securities and Investments Commission v RI Advice Group Pty Ltd [2020] FCA 1277 was one in which evidence was given by a solicitor, Ms Whiting, that she had reviewed materials produced to ASIC and taken instructions in order to understand the circumstances surrounding the creation of the relevant file review.  She did not say from whom she received instructions, whether or not they came from a person who was involved in the document’s creation or what their content was.  In the context of such deficient evidence, the failure to call easily identifiable individuals who could give such evidence was clear and forceful (see analysis at [47]–[52] per O’Callaghan J).  This was another example where the deficiencies in the evidence was highlighted or exacerbated by the use of hearsay.  Each case turns on its own facts, and in all cases, the nature of the evidence must be considered holistically.  Whether the evidence is sufficient will depend on the nature of the claim.  However, reliance upon hearsay evidence as one element of the evidence relied upon in an application of this kind does not necessarily lead to an adverse inference arising from the failure to call that person to give evidence.  Whether it does so in the context of certain complaints made about particular deficiencies in the evidence is considered in the following analysis.

66 Ms Lim and Ms Rodgers were the individuals who were largely responsible for the instructions to Allens to create the Chronologies and provide them to Westpac.  Evidence of the facts surrounding those instructions is objective and relevant.  Evidence about what those individuals thought was the effect of those instructions is subjective and of little use to my analysis.

67 The distinction is significant because purpose is determined objectively by reference to a range of factors.  In Commissioner of Australian Federal Police v Propend Finance Pty Ltd (1997) 188 CLR 501, Brennan CJ observed that determining the identification of the purpose for which the communication came into existence, “[t]he test is anchored to the purpose for which the document was brought into existence” (at 508).  The evidence of Ms Rogers and Ms Lim’s understanding of the purpose of the work, and the instructions pursuant to which it was carried out, is relevant to (but not determinative of) the purpose for which the document was brought into existence because their instructions guided the steps taken by those who did in fact bring the Chronologies into existence.  In making this observation, I emphasise that it is simply one of the aspects of relevant evidence.  It is not the purpose of Allens that is relevant, it is the purpose of Westpac.

68 The Applicant relies on Kennedy v Wallace [2004] FCAFC 337; 142 FCR 185 (Kennedy).  The Applicant argues that in that case the Court found that notwithstanding the subjective intention of those persons who were engaged in the provision of instructions to create the documents, the evidence of surrounding circumstances demonstrated the presence of such significant non-privileged purpose that the burden was not met.  The Applicant draws an analogy between the present case and Kennedy, pointing in particular to the lack of evidence about the decision as to the subsequent use of the Chronologies.  However, in Kennedy, the party asserting privilege (ie, the client) gave evidence of “conclusions that are not supported by any revealed reasoning process” (at [12]) in circumstances where the client agreed that he had little recollection of the circumstances under which the notes the subject of the dispute were prepared (at [15]).  Kennedy is therefore factually distinct from the present case where there is hearsay evidence from a range of individuals about the steps that they took to call the Chronologies into existence.  If anything, Kennedy reinforces the importance of objective analysis of purpose, rather than reliance upon subjective intention, in a way which blunts much of the Applicant’s criticism of the Respondent’s failure to call individuals involved in non-legal workstreams to give their subjective views about the relevance or importance of the work being carried out.

69 The Applicant argues that the evidence is conclusory.  I have ascribed no weight to the evidence that Ms Lim believed that “the decision to allow the Advisory Panel and Promontory to review copies of those materials did not in any way alter the purposes…”.  I accept the Applicant’s submission that there is little evidentiary weight to be obtained from such bare statements of conclusion.

70 The Applicant is also critical of the evidence of Ms Rodgers because it is said to involve incongruities, for example:

(1) The Applicant asserts that on the one hand, Ms Rodgers knew that the Chronologies would be provided to the Advisory Panel and Promontory, but on the other hand, she says that she was not “informed” that the “purpose” had changed.  The Applicant argues that the Court should not reason from this that the change of purpose had not arisen simply because she had not been “informed” one way or the other.  It is said that this means no more than “no one uttered the words: a non-privileged purpose had arisen for the Chronologies”.  I do not perceive any incongruity.  The evidence simply identifies and supports the notion that to Ms Rodgers’ knowledge, the only purpose of Allens’ work was to provide legal advice and assistance and no other purpose was conveyed to her.  It is part of the matrix within which the claim for privilege is to be examined.

(2) Relatedly, the Applicant argues that there is incongruity in relation to Ms Rodgers’ evidence that she did not “come to understand” that the purpose for preparing the Chronologies had changed or that additional purposes had arisen; notwithstanding that she understood that, once completed, copies of the Chronologies could also be provided to the Advisory Panel and Promontory.  This concern reflects a circular analysis of the issue which bedevils the Applicant’s analysis: it reasons that because the decision had been made to provide the Chronologies to the Advisory Panel, an additional purpose must have arisen for the creation of each document, as opposed to merely an additional   use for the document that was being created.  The evidence of Ms Rodgers does no more than reflect a different understanding of purpose in light of the decision that had been made.  It may or may not be accurate on an objective analysis, but it reflects no incongruity.

71 The Applicant argues that the inadequacies in the evidence concerning Ms Rodgers’ evidence are exacerbated by the fact that it is given via hearsay.  For the reasons discussed above, I do not understand that the use of hearsay in itself is a sufficient basis for an adverse inference.  In addition, for the reasons identified, I do not agree that the incongruities or inconsistencies exist.

72 The evidence of Ms Lim is said to suffer from a similar vice.  Moreover, while it is the case that Ms Lim’s evidence is that she “did not instruct Allens, nor did she instruct any lawyer in her team to instruct Allens, that the purpose for the work had changed or that there was now an additional purpose for that work” there is no incongruity or inconsistency between that evidence and other evidence that Ms Gray of Westpac informed Mr Kerrigan of Allens that the Chronologies “may be provided to external expert workstreams undertaken by the Advisory Panel and Promontory”.  Indeed, I consider that evidence to be consistent with the notion that an additional use had been identified for the Chronologies that were under construction.

73 Overall, there is cogent evidence given by hearsay that is relevant to the question of the objective purpose of Westpac in obtaining the Chronologies.  It must be considered as part of the whole of the factual matrix.  I therefore turn to other aspects of the evidence upon which Westpac relies.

Additional evidence relevant to purpose

74 Mr Harris gives evidence that he was told by Mr Kerrigan, a partner at Allens, that from at least 22 November 2019, work on preparing some of the Chronologies had commenced.  In addition,

(1) Mr Harris was himself engaged by Westpac to assist with the AUSTRAC response from around 25 November 2019.  At that time, he had discussions with Mr Haig of Allens in which the work in preparing the Chronologies was discussed.  He says that he was told by Ms Lim and Ms Kylie Gray that Allens would be preparing Chronologies on the key issues in the AUSTRAC statement of claim for the purpose of providing Westpac with legal advice and assistance in relation to its defence of those allegations.

(2) Mr Harris was informed by Mr Kerrigan, a partner at Allens, that:

(a) Allens’ engagement in relation to the AUSTRAC Proceeding included providing litigation, continuous disclosure and other legal advice and assistance in relation to its defence of the AUSTRAC Proceeding.

(b) Allens’ work commenced shortly after 22 November 2019.

(c) He recalls discussions with Ms Kylie Gray, Ms Rodgers and other lawyers in the Westpac legal team that the purpose of the Chronologies was to consider the allegations in the AUSTRAC statement of claim so as to provide Westpac with legal advice and assistance in relation to its defence of the AUSTRAC Proceeding.

(d) No earlier than December 2019 he was told by Ms Kylie Gray that the Allens Chronology “may be provided” to a number of workstreams, including the Advisory Panel and Promontory.

(3) Ms Kylie Gray told Mr Harris that Allens would be preparing Chronologies on the key issues in the AUSTRAC statement of claim for the purpose of providing Westpac with legal advice and assistance in relation to those allegations.

75 The evidence comfortably establishes that the dominant purpose at the time the Chronologies were commissioned was legal.  I also consider that the evidence establishes that no instructions were provided to the lawyers preparing the Chronologies that there had been any change to the purpose, or that they should alter their task or focus in drafting the Chronologies.  The lawyers were told that the Chronologies “may” be provided to the Advisory Panel and Promontory. That is not sufficient to shift the nature of the Chronologies.

76 It was the view of the person who actually commissioned the Chronologies (Ms Lim) that she would not have done so but for the need to respond to the AUSTRAC statement of claim.

77 Westpac submit that the usual time for assessing purpose is the time of commissioning, citing Roberston at [88]:

it will usually be the case that, where a party has commissioned a report from a third-party provider the relevant time to assess the party’s purpose for doing so will be at the time of commissioning. But that is not to say that evidence as to later events cannot be relevant. For example, the evidence might show that the purpose for the report changed over the period from the commissioning of the report to its provision.

78 As noted above, I accept that the purpose can change over time.  I consider the evidence of the initial purpose to be relevant to, but not determinative of, the question of dominant purpose.  Plainly, the purpose at the time of commissioning was legal. The core question is whether the purpose changed because of the decision to provide the documents to the Advisory Panel or to Promontory.

79 I am satisfied that the decision to provide the Chronologies to the Advisory Panel and Promontory was made some days following Westpac’s decision to appoint the Advisory Panel.  The submissions of the Applicant accurately record the evidence in this respect (emphasis added):

…the evidence establishes that “some days following” Westpac’s decision to appoint the Advisory Panel (announced on 28 November 2019), Mr Evensen asked Westpac’s internal legal team whether there were materials that could be provided to the Advisory Panel and that, following that request,  Mr Peter King, Westpac’s then Chief Executive Officer, agreed that the Chronologies could be.  In ‘early December’, Mr Harris discussed Mr Evenson’s request with Ms Lim and Ms Gray.

Conformably, in December 2019, Westpac (Ms Gray) informed Allens (Mr Kerrigan) that the Chronologies may be provided to a number of legal workstreams relevant to the AUSTRAC Proceeding which were being conducted by other external law firms as well as to the external expert workstreams which were being undertaken by the Advisory Panel and Promontory.

80 This characterisation of the facts is important because, as the emphasised words demonstrate:

(1) Mr Evensen did not request the creation of Chronologies for use by the Advisory Panel. He requested “materials that could be provided to the Advisory Panel”.  I interpolate that the request centred around materials in any event being created, in relation to which an additional use was contemplated because of the time critical environment.

(2) The Westpac CEO agreed that the Chronologies could be provided to the Advisory Panel in response to that request by Mr Evensen.

81 This is consistent with the identification of an additional or subsidiary use of Chronologies that were in the process of being created.  That decision was not relevant to the Chronologies being called into existence or provided to Westpac.

82 The objective identification of purpose can be assisted by considering the instructions which led to the communications in question (Cantor at [69] quoting AWB (No 5) at [44]).  It is therefore relevant to the question of purpose whether the content of the Chronologies was in any way affected by the decision to provide them to the Advisory Panel.  Mr Harris deposes that:

(1) He was informed by Ms Rodgers that she was involved in day-to-day work with Allens.  She told Mr Harris that she never conveyed to Allens any purpose other than that which had originally called for the creation of the Chronologies, nor did she observe any other purpose being considered by Allens.

(2) He was told by Ms Lim that after the decision to share the Chronologies had been made, she did not instruct Allens, and she did not instruct any lawyer in her team to instruct Allens, that the purpose for the work had changed, or that there was an additional purpose.

(3) Mr Kerrigan, a partner at Allens, told him that by “no earlier than December 2019” he was informed by Ms Gray that the Chronologies may also be provided to the Advisory Panel and Promontory.

83 The Applicant asserts that because Allens were informed that the Chronologies may be provided to the Advisory Panel and to Promontory, I should conclude that this changed or could have changed the nature and focus of the work.  In the face of this possibility, it is said that further evidence is required to satisfy Westpac’s onus of proof.  I do not agree.  The evidence is that there were no instructions given by Westpac to Allens that the purpose of the Chronologies had changed, or that their content would need to be altered.

84 That the Chronologies continued to be generated by reference to the original instructions is strong, objective evidence that supports the proposition that the initial instructions chiefly inform the purpose for which the documents were communicated.  Had the decision been made not to provide the Chronologies to the Advisory Panel and to Promontory, then the Chronologies would still have been provided in the way that they were.  This is consistent with the provision to Promontory and the Advisory Panel being a subsidiary or additional purpose.

The nature of the documents

85 The Chronologies directly track the structure of and the issues in the statement of claim, in some instances by reference to specific paragraphs.  In other instances, there are introductory statements of purpose that are consistent with Westpac’s contentions in this application.  In at least one instance those introductory remarks make clear that certain matters relating to work being undertaken by the Advisory Panel were not being addressed in the Chronology.

86 The documents also carry a marking indicating that they are privileged and confidential to which I ascribe only very little weight given the attitude in the authorities to such statements (see, eg, Federal Commissioner of Taxation v PricewaterhouseCoopers [2022] FCA 278 at [147] (Moshinsky J)).

87 Overall, the nature of the documents, understood by reference to the evidence about the circumstances in which they came into effect, and my actual review of them, support the existence of the dominant purpose for which Westpac contends.

88 These conclusions are fortified by the output of the Advisory Panel and Promontory.

89 The core purpose of the Advisory Panel was not to interrogate the specific AUSTRAC allegations (as noted in its Executive Summary).  I do not consider that the Chronologies were critical to the task of the Advisory Panel, but I have no doubt that they provided helpful context.  The purpose of the Promontory report was, as stated in the report, to:

provide assurance to the Westpac Board that Westpac’s Management Review of Accountability for the alleged failings was robust, based upon an accurate and complete set of facts, and employed a sound methodology for arriving at its conclusions.

90 In addition, the Promontory report noted:

Our assurance activities, which ran for a period of around five months, included reading and assessing documents, including vast quantities of documents made available by Westpac, relevant Westpac policies, procedures and frameworks, Management and Board Committee papers, and a methodology document compiled by the Review Team. These were supplemented by two walk-throughs by the Team of their approach and methodology as applied to the allegations relating to Westpac’s failure to adequately monitor international transactions for Child Sex Exploitation. We conducted our own analysis of these inputs and were provided with, and took, the opportunity to challenge the Review team on its methodology and interpretations.

91 Its conclusions were limited to the following (emphasis in original):

1. That the Review of Individual accountabilities for the alleged failings identified by AUSTRAC was designed in a way that was appropriate for the objectives of the Review. In particular:

* the scope of the Review provided the Review Team with adequate flexibility to investigate the AUSTRAC allegations;

* while the information available to Promontory was less extensive than that available to the Review Team, we were satisfied that the latter was sufficiently broad and accurate for the Review Team to develop a robust methodology for the Review;

* the methodology developed by the Review Team, as described in their Methodology Document and inferred from the walk-through of the CSE stream, was sound and appropriate for arriving at conclusions and recommendations consistent with the objectives of the Review; and

* the range of individuals targeted for interview was adequate and appropriate for assessing accountability.

2. On the basis of our limited sample of one work stream, the methodology appears to have been implemented as designed, and with appropriate care and due diligence.

3. Given our lack of visibility over the conclusions and recommendations made by the Review Team, Promontory is only able to provide negative assurance over these. Specifically, we saw no reason why the methodology, if implemented as designed, should not lead to accurate and appropriate conclusions and recommendations.

92 The fact that Promontory reviewed documents (including, I infer, the Chronologies) as part of its assurance does not mean that the documents were provided for the dominant or equal purpose of carrying out that review.

93 Accordingly, the reports and records of Promontory and the Advisory Panel do not suggest that the Chronologies in the form in which they were received were created for those reviews.  They may well have been part of the briefing materials, but that utility is consistent with a subsidiary use for Chronologies which would have been called into existence without that use.  It is clear from the structure of the documents themselves that had the Chronologies not been sought for the purpose of responding to the statement of claim they would not have been drafted as they were.

94 Alternatively, it might be said that commissioning a Chronology as a “source of truth” for matters associated with the statement of claim in the AUSTRAC Proceeding for use in the broad, multi-factorial response to the issues underpinning the statement of claim establishes that the legal purpose did not predominate.  I accept that the statement of claim contained a very important set of allegations against Westpac, and its response to that document would need to be considered more broadly than merely to prepare its defence in the AUSTRAC Proceeding.  However, it would be circular to conclude that because the statement of claim was of significance to Westpac more broadly, responding to it ceases to be for a dominant legal purpose.  On the contrary, the fact that the statement of claim acts as an anchor for the work undertaken in the Chronologies underscores the significance of the litigation and legal advice relating to it in the purpose of the documents.

95 Overall, the more compelling part of the Applicant’s case is that while there is cogent evidence that the legal workstreams commissioned the Chronologies for a legal purpose, there could be a gap because of a failure to call individuals who may have had different views as to purpose because of their involvement in the non-legal workstreams.  It is to this issue which I now turn.

Did Westpac fail to adduce evidence from key persons?

96 It is the purpose of Westpac that is critical to the present analysis.  The time that is critical is the time at which the Chronologies were provided to Westpac by Allens.  The purpose must be determined objectively.

97 The Applicant submits that a failure to call individuals involved in the decision to deploy the Chronologies for non-privileged workstreams is a key failure.  He submits that in Robertson a similar failure led to the conclusion that the burden had not been discharged.  It is important therefore to analyse the circumstances in Robertson.

98 In Robertson, the Court was considering whether a report, commissioned by Optus from Deloitte, was privileged.  The request to Deloitte to carry out a review (the Deloitte Review) was made following a significant data breach.  In the hours and days following the data breach, Optus announced that it would engage an independent third party to review the circumstances that had led to the data breach.  It then announced that Deloitte would carry out that work.  In the public announcements and the Board decision endorsing the decision to brief Deloitte there was no mention of a legal purpose behind the engagement, while there were a number of clear non-legal purposes.  Ashurst were also engaged to advise Optus.

99 In the face of the overwhelming evidence of the contemporaneous material suggesting a non-legal purpose to the Deloitte Review, the in-house solicitor did not “explain or contextualise” those non-legal purposes as opposed to the legal purpose that he purportedly considered to dominate (at [59]).  Nor was other evidence proffered from officers of Optus with involvement in the initial decision to commission the Deloitte Review in circumstances where that decision was approved by the Board without reference to any legal purpose and with apparent purposes that were plainly non-legal (at [59], [63]-[65]).  For example, the Board resolution to confirm the appointment of Deloitte was in the following terms (at [16]):

(a)          that Deloitte be appointed to undertake independent external forensic reviews of the Cyberattack, including:

1.    to identify the circumstances and root causes leading to the Cyberattack;

2.    to review Optus’s management of cyber risk in the context of the applicable cyber risk management policies and processes in connection to the Cyberattack; and

3.    to review the Cyberattack incident response, and the appropriateness of actions taken, having regard to the existing crisis management policies and procedures; and

(b)          that, in relation to the reviews, Optus management be requested to report back to the Board, and in accordance with the Optus delegation framework.

100 It was the failure to call evidence of any quality to explain how an independent external forensic review of that kind could be credibly said to have a dominant legal purpose that led to the Court’s comments about the paucity of evidence in Robertson.  While each case turns on its own facts, I do not understand Robertson to stand for the proposition that it is necessary in every case to call evidence from the Board or senior managers.  It was necessary in that case to do so because of the manifest significance of the Board and senior managers in commissioning the Deloitte Report in the first place, in the context of the non-legal purpose which was so clearly evident in the objective circumstances.

101 This case is quite different.  While some parts of the evidence might be conclusory, much of it is not.  It includes evidence from those individuals involved in the decision to have the Chronologies created and who were closely involved in the process until they were delivered to Westpac.

102 In Robertson, the Court was dealing with a case where the contemporaneous materials suggested a non-legal purpose, such that the failure to explain how that position changed, or to contextualise the objective evidence indicating that purpose, was glaring.  In this case, the Chronologies were initially commissioned for an undoubtedly privileged purpose; there is a question of fact whether the purpose changed, or simply whether another use was identified.

103 In relation to the evidence of Mr Evensen, it is not clear how Mr Evensen could have given evidence about the importance of the Chronologies to give a fact base for the various reviews: he was not carrying them out.  Any evidence he gave on that topic would have suffered from the deficiency of which the Applicant otherwise complains: it would have been speculation about the subjective views or motivations of others.

104 The failure to call evidence from each of Ms Stephanie Gray and Ms Kylie Gray is criticised.  There are two people by the name of Ms Gray in this proceeding: Ms Kylie Gray, an in-house lawyer, and Ms Stephanie Gray, a member of Westpac’s internal AUSTRAC Response Secretariat Team, who authorised the engagement of Promontory.  The failure to call evidence of either is criticised.  While there is a small amount of hearsay evidence from Ms Kylie Gray in the Harris Affidavit, the core of the criticism is that there is no evidence from her about the discussions that she had with Allens after the initial instructions were provided. Given the hearsay evidence from Ms Lim of Westpac (to whom Ms Gray reported) to the effect that neither she nor any lawyer in her team instructed Allens that the purpose for the Chronologies had changed, I do not consider the limited nature of the hearsay evidence from Ms Kylie Gray to be of significance.

105 The criticism in respect of Ms Stephanie Gray focuses on a lack of evidence from her in circumstances where she was involved in the establishment of the Promontory Statement of Work Services which referred to an obligation on Promontory to review the Chronologies “prepared by Allens in the course of responding to the AUSTRAC allegations”.  I pause to note that the characterisation of the Chronologies in the Promontory Statement of Work Services is consistent with a conclusion that the Chronologies were prepared by Allens in the course of their work responding to the AUSTRAC allegations.

106 It is said that the Statement of Work Services involved Westpac making the decision to provide the Chronologies to Promontory and that therefore evidence was required (from Ms Stephanie Gray or another person involved in that decision) to explain that decision.  In oral submissions, Senior Counsel for the Applicant put the matter this way:

…so they’re [the Westpac lawyers] speaking to their own work stream and, of course, it’s natural enough that they had, in their mind, the legal purpose, because that’s the only thing they were working on. But if your Honour, we would ask rhetorically, was to ask the CEO, Mr King, or Ms [Stephanie] Gray, or Mr Evensen, what was their purpose, your Honour might well have a different answer...

107 It is correct that it is the purpose of Westpac (the entity) that is relevant.  However, it is artificial to expect that senior officers of Westpac turned their mind to whether their decision to share a document that was in any event being created altered the purpose for which it was being sought in the sense contemplated by the authorities.  I am more assisted by the objective evidence about what actually happened, which I have summarised above.  Synthesising that evidence, I have concluded that there is no relevant gap, as the evidence establishes that:

(1) The initial instructions to Allens to draft and provide the Chronologies were for the purposes of legal advice.  No other purpose was discussed or contemplated at the time that the initial instructions were provided to Allens by Westpac.

(2) Allens were a law firm engaged by Westpac for the purposes of providing legal advice and assistance in responding to the AUSTRAC Proceeding and related advice and proceedings.  It is consistent with this engagement that its work product, when provided confidentially to those who instructed it, would:

(a) be responsive to the instructions that led to it being created; and

(b) involve the exercise of legal skill and expertise consistent with the provision of legal advice and responding to litigation.

(3) The decision to provide the Chronologies to the Advisory Panel was made in response to an undifferentiated request by Mr Evensen for materials that could be provided to the Advisory Panel.

(4) The decision to provide the Chronologies to the Advisory Panel and to Promontory did not lead to any change to the instructions given to Allens about the way in which work on the Chronologies would be carried out.  While the evidence suggests discussions were ongoing, the evidence is that no change to the purpose or content of the Chronologies was communicated to Allens because of the decision to provide the Chronologies to the Advisory Panel and Promontory.  While not determinative, a change to purpose could be expected to lead to a change to instruction, that could impact upon form, content or focus.  The fact that there was none is a relevant factor.

(5) It follows that the instructions which governed the provision of the Chronologies to Westpac by Allens were those which were directed to a legal purpose, and the Chronologies were provided to Westpac in time to be used in the preparation of the defence.  The evidence is that they were deployed for that purpose.

(6) Having inspected the Chronologies, it is clear that they are primarily directed to responding to the factual issues raised in the statement of claim to facilitate a response to them.  Each file name corresponds with a contravention or type of contravention alleged by AUSTRAC in its statement of claim.  The structure and content of the Chronologies themselves demonstrate that the ruling or prevailing purpose was responding to the allegations in the statement of claim.

108 Taken together, these conclusions demonstrate that it was the legal purpose which “…accounted for [the documents] being brought into existence” (AWB v Cole at [107] citing Pratt Holdings v Commissioner of Taxation at [35]).  There can be a distinction to be drawn between the dominant purpose for which a communication is brought into existence and the use to which it is ultimately put (Tommy v Western Australia (No 2) [2019] FCA 1551 at [119] per Mortimer J (as her Honour then was)).

109 I consider that those matters, taken together, are sufficient for Westpac to discharge its burden that the Chronologies were provided to Westpac by Allens for the dominant purpose of legal advice and extant legal proceedings.  I have concluded that the decision to provide the Chronology to the Advisory Panel and Promontory was a decision to put the Chronologies to a subordinate use.  It was not a purpose for the creation of the Chronologies, it was an additional use for documents being created in any event.

110 The Applicant’s case was carefully and persuasively put, and it has a certain attraction to it.  However, it proceeds on the basis that the decision to provide the Chronologies must represent a change to the purpose of the Chronologies.  However, given the objective nature of the test, the relevant question is not to be answered by what individuals thought was the most important purpose to which the Chronologies would be put.  As the Applicant correctly submits, each workstream might well consider its own to be the most important.  The objective nature of the test directs focus to the purpose for which the documents were called into existence.  Even allowing for the time at which that question is assessed to be the time of communication, the objective evidence concerning the factors at [107] above, satisfy me that the dominant purpose was the provision of legal advice and the defence of the AUSTRAC Proceeding.  This is consistent with the comments of Barwick CJ in Downs where his Honour said (at 677):

… the fact that the person who produced, or the person or authority who or which directed the production of the document, had in mind other uses of the document will not preclude that document being accorded privilege, if it were produced with the requisite dominant purpose.

111 Similar sentiments have been reiterated in subsequent cases.  In AWB v Cole at [105], Young J cited the comments of Kenny J in Pratt Holdings, where her Honour made clear that the subordinate purpose can exist at the time the communication was made (at [30(7)]).

112 On an objective analysis, the fact that the Chronologies, once completed, were provided to the Advisory Panel and Promontory does not alter the dominant purpose for which they were communicated.  It does raise a question of waiver, to which I will now turn.

Was privilege waived by provision of the Chronologies to third parties?

113 The principles concerning waiver of legal professional privilege were not in dispute.  Relevantly, they include:

(1) The party asserting the waiver bears the onus of establishing it (New South Wales v Betfair [2009] FCAFC 160; 180 FCR 543 at [54] (Kenny, Stone and Middleton JJ)).

(2) Privilege is waived where a client acts in a manner that is inconsistent with the maintenance of the confidentiality of communications between lawyer and client which legal professional privilege exists to protect (Mann v Carnell [1999] HCA 66; 201 CLR 1 (Mann v Carnell) at [28]–[29] (Gleeson CJ, Gaudron, Gummow and Callinan JJ); UIL (Singapore) Pte Ltd v Wollongong Coal Ltd [2023] FCA 1578 at [52] (Beach J), and the cases cited therein)).

(3) Privilege can be maintained in the face of a disclosure to a third party for a limited and specific purpose, subject to obligations of confidence.  Each case turns on its own facts. A core question is whether the disclosure is in some way inconsistent with the maintenance of the privilege.  Issues of fairness can be relevant to the inconsistency analysis as seen in Goldberg v Ng (1995) 185 CLR 83 analysed in Mann v Carnell at [30].

114 Westpac provided the Chronologies to the Advisory Panel on the express basis that they were subject to legal professional privilege and were “being provided on the basis that they will be treated with strict confidentiality and not inconsistently with Westpac’s ability to maintain privilege over them”.  In many, if not all, instances, they were protected by passwords.

115 As set out above, the Advisory Panel’s engagement specifically included obligations of confidentiality.  They are summarised at [25]-[26] above.

116 The use to which the Chronologies could be put was limited by the terms of the engagement of the Advisory Panel.  Moreover, the contemporaneous email by which access was provided made clear that the purpose for which they were provided was to give context to the Advisory Panel in relation to the matters alleged by AUSTRAC.

117 Promontory also received the documents on the basis of an express expectation of confidentiality in the email covering the provision of the documents, and subject to confidentiality obligations set out in the MSA.  Similarly, it appears that Promontory accessed the Chronologies by accessing a document repository, Shield Docs, and that password protection was in place.

118 The combined effect of the standard terms of confidentiality when considered in combination with the expression of confidentiality attaching to their provision is sufficient for me to conclude that the Chronologies were provided on a confidential basis.

119 It is notable that neither the Advisory Panel, nor Promontory, were tasked with undertaking a fact-finding task that was at large, or which encompassed all of the matters the subject of the AUSTRAC statement of claim: the Advisory Panel was tasked with answering two questions while Promontory was required to provide an assurance letter.

120 The Chronologies were not referred to or extracted in the report of the Advisory Panel or the letter of assurance provided by Promontory.  There is no question or issue of waiver arising from the use of the Chronologies in this way.

121 The evidence therefore leads me to conclude that the Chronologies were provided to Promontory and the Advisory Panel on a confidential basis for a limited and specific purpose, and that in all the circumstances, there was no waiver of the privilege which I have found to subsist.

The Notes

122 The First Note is dated 16 December 2019 and entitled “Overview of AUSTRAC claims against Westpac regarding alleged contraventions of the AML/CTF Act”.

123 Mr Harris gives evidence that he was told by Ms Rodgers that:

(1) Within a day or so of the commencement of the AUSTRAC Proceeding, Ms Kylie Gray requested that Allens “prepare an overview of the AUSTRAC Statement of Claim to assist Westpac in analysing the AUSTRAC allegations”.

(2) Allens provided Ms Gray with an earlier version of the First Note “ahead of an internal meeting on 21 November 2019 in relation to the AUSTRAC Proceeding which Allens partners Peter Haig and Chris Kerrigan also attended as guests”.  The agenda for the meeting records that Mr Haig was to address the AUSTRAC statement of claim by reference to this document.

(3) The purpose of the document was to provide “legal advice and assistance to Westpac on its defence to the AUSTRAC Proceeding”.

(4) On 16 December 2019, Allens made minor (although unspecified) amendments to the document, which resulted in the First Note.

(5) On 24 January 2020, the First Note was provided to the Advisory Panel as an attachment to an email.

124 The Applicant argues that the First Note was different from the document Allens sent to Westpac on 21 November 2019, and that there is a lack of evidence supporting the claim of privilege in respect of the First Note.  It is argued that the First Note cannot be said to be privileged based on the evidence used to s upport the claim of privilege in the “earlier version” of the document.  It is said that the evidence from Ms Rodgers regarding the purpose of the document is bare ipse dixit that is inadequate to establish privilege.

125 The Second Note is entitled “Privileged & Confidential – preliminary outline of facts re IFTI non-reporting” and dated 16 February 2020.  Mr Harris deposes that “during discussions between Westpac and Allens, which took place in the days and weeks following the commencement of the AUSTRAC Proceeding” Ms Kylie Gray instructed Allens to prepare the document.  Mr Harris deposes that, according to Ms Rodgers, Westpac requested the document:

in connection with the AUSTRAC Proceeding and, specifically, to provide legal advice and assistance to Westpac in relation to the IFTI non-reporting allegations in the AUSTRAC Proceeding.

126 The Second Note was provided to Promontory on 17 February 2020, pursuant to the confidentiality arrangements discussed above.  Mr Harris deposes on information and belief from Ms Rodgers that it was provided to Promontory “on a confidential and restricted basis to assist the Advisory Panel to consider the governance of the matters included in the AUSTRAC Statement of Claim”.

127 The Applicant argues that the Second Note is not privileged because:

(1) I should infer that given the close timing of the creation of the document and its provision to the Advisory Panel, it can reasonably be inferred that a purpose for its creation included provision to the Advisory Panel.

(2) The evidence of Westpac does not establish the dominant purpose was privileged, because Mr Rodgers’ evidence is that Ms Kylie Gray instructed Allens to prepare the document, but she cannot say when it happened save that it was in the “days and weeks following the commencement of the AUSTRAC Proceedings”.

(3) The evidence relied upon is said to be no more than an ipse dixit assertion that is inadequate to establish a privileged purpose.

128 It is not in dispute that the First Note and the Second Note were prepared by Allens following a request from Westpac’s in-house legal team.  The First Note was commissioned prior to the establishment of the Advisory Panel.  It is not disputed that the document provided on 21 November 2019 is privileged.  I consider that the circumstances leading up to the creation of the First Note included the circumstances of its predecessor version.  The fact that the amendments were minor is likewise relevant.  There is no reason to conclude that minor amendments altered the purpose of its communication.

129 Moreover in relation to the Second Note, there is no basis to infer, merely because of the proximity in timing between the creation of the document and its provision to the Advisory Panel, that its provision to the Advisory Panel became a purpose for which the document was created.

130 I have inspected the documents to assist my analysis.  Their content is consistent with the conclusions that I have set out above.  Accordingly, I have concluded that the dominant purpose for communication of the First Note and the Second Note was a privileged one.

131 The First Note and the Second Note were provided to the Advisory Panel based on the same understanding of its obligations of confidentiality that I have outlined in relation to the question of waiver of the Chronologies.  For the same reasons, I have concluded that the provision of the First Note and the Second Note for a limited and specific purpose to a third party on a confidential basis did not result in a waiver of the privilege.

The Summary

132 The Summary is a document prepared by Westpac’s internal AUSTRAC Response Secretariat Team and provided to the Advisory Panel on 20 April 2020.  It contains a portion that is redacted because it contains an extract from the Chronologies.

133 Because of my conclusions in relation to the Chronologies, it follows that the redacted portion of the Summary is privileged.  That privilege has not been waived for the reasons outlined in relation to the Chronologies.

DISPOSITION

134 The orders of the Registrar ought to be set aside and the application for production dismissed.  I will hear the parties on costs.

Associate:

Dated:    24 July 2025