5.1 If there is wider circulation of legal advice to government, should there be restrictions on the use of some legal advice beyond the immediate client? Some government information is already subject to “privilege” which shields it from disclosure in certain circumstances. This chapter examines the concept of “privilege” and its relevance to the wider circulation of legal advice. It also poses the question of whether there should be any other grounds for excluding legal advice from wider circulation.

CURRENT LAW AND PRACTICE

5.2 The policy expressed by governments, and manifested in the Freedom of Information Act 1989 (NSW) and the Freedom of Information Act 1982 (Cth), is that government information should be readily available and that citizens should have a right of access to it. This legislation does provide that certain classes of government documents should not be available more widely, because the public interest requires that these classes of documents remain confidential to government. For example, there are provisions in the State and Federal Freedom of Information Acts that allow for documents which may concern criminal prosecutions and which may be subject to legal professional privilege to be exempt from production to the public.

5.3 A document produced by a Law Officer or the Crown Solicitor for the dominant purpose of giving legal advice will be subject to legal professional privilege and thus exempt from disclosure,¹ whether or not it also gives advice on more general issues of policy or administration. Such documents may also be the subject of a claim for privilege on the basis that disclosure would be contrary to the public interest.

5.4 The following section addresses the question of whether legal advice to governments, as a matter of law, is, and should be, the subject of legal professional privilege or some other privilege.

PRIVILEGE

5.5 When the law refers to “privilege” it refers to a situation where a person may be excused from doing something which others are required to do. A court can require a person to surrender relevant documents to the court unless the documents are subject to privilege. This section discusses two different types of privilege that are specially relevant to this Issues Paper.

Public interest immunity²

5.6 The “public interest privilege” of the executive government is the subject of s 130 of the Evidence Act 1995 (NSW) which codifies and clarifies the common law as laid down in Sankey v Whitlam.³ There, the High Court decided that if the government claims that certain documents or information are privileged from being given in evidence on the grounds of a countervailing public interest (“public interest privilege”), the court itself may examine the material to see whether there are reasonable grounds for claiming that privilege.

5.7 Since that case, both State and Federal governments, have enacted Freedom of Information Acts. The general public policy now expressly embodied in those Acts is openness of government. In particular, the Acts create, and provide means of enforcing, citizens’ rights of access to government information. However, the law generally recognises that, at times, the courts must balance the public interest in access to government information with a competing public interest in confidentiality of that information to ensure the efficient and effective working of government. Included in this privileged government information might be the advice given by the Law Officers and the Crown Solicitor.

5.8 The courts have also recognised that there may be cases in which documents or other information created for the purpose of policy-making, government administration, or other government operations should be protected from public scrutiny. One commentator suggests that this type of privilege is of recent origin and should be confined to material created in the course of government business which is conducted in the public interest and may not extend, in his view, to all functions of the modern welfare state.⁴

Legal professional privilege

5.9 When a document is created by a person for the purpose of giving or obtaining legal advice that document is privileged from production in court.⁵ When a private individual seeks the advice of a lawyer, especially in relation to actual or potential litigation, the law does not compel production of communication between the client and the lawyer as part of the evidence that a court subsequently uses to make its decision. The High Court stated the reason for this privilege in Grant v Downs⁶ :

The rationale of this head of privilege, according to traditional doctrine, is that it promotes the public interest because it assists and enhances the administration of justice by facilitating the representation of clients by legal advisers, the law being a complex and complicated discipline. This it does by keeping secret their communications, thereby inducing the client to retain the solicitor and seek his advice, and encouraging the client to make a full and frank disclosure of the relevant circumstances to the solicitor. The existence of the privilege reflects, to the extent to which it is accorded, the paramountcy of this public interest over a more general public interest, that which requires that in the interests of a fair trial litigation should be conducted on the footing that all relevant documentary evidence is available.

5.10 To the extent that a Law Officer, the Crown Solicitor, or a person employed on their staff gives information to or receives information from a client (the Crown) for the purpose of preparing legal advice, or for the purpose of litigation, the Evidence Act 1995 (NSW)⁷ precludes that document from being required to be given in evidence in court. It is clear that the courts give a very wide meaning to the expression “legal advice”.⁸ The advice need not be directed at actual or impending litigation.

Salaried legal practitioners

5.11 In Waterford v Commonwealth of Australia⁹ it was suggested (on the basis of comments made in Attorney General (Northern Territory) v Kearney)¹⁰ that legally qualified people employed on a salary, for example lawyers employed in a government department and “in-house” lawyers, were not legal practitioners for the purpose of the rules relating to legal professional privilege. It was argued that such lawyers’ employee relationship compromises their ability to act as independent legal advisers. The majority of the Court had no difficulty in holding that “salaried” lawyers employed in government departments, especially the Crown Solicitor’s Office, were in the same position as solicitors or barristers in private practice, and as such their communications were subject to privilege if they contained legal advice. Justice Brennan (dissenting on this point) took the view that, generally speaking, salaried lawyers were not lawyers for the purpose of these rules but made an exception for lawyers employed on the staff of the Attorney General of the Commonwealth or a State. The other members of the Court accepted that lawyers in employment in such offices were covered by the rules relating to legal professional privilege.

Legal advice or policy advice?

5.12 On first sight it would seem that the government, when represented before the courts, is (or ought to be) in the same position as any client who employs the services of a lawyer. Some documents prepared by the Law Officers or the Crown Solicitor may relate specifically to questions which are being litigated or which may potentially be the subject of specific litigation. At other times, the Law Officers or the Crown Solicitor may be asked to give general advice on the scope or application of legislation or a rule of common law without any prospect of specific litigation. All this advice could be considered legal advice and may attract legal professional privilege. Crown Law Officers may also be called on to advise on ways of giving effect to various policy options. This distinction between legal advice and policy advice distinguishes the government from other clients. These two types of advice were considered Waterford’s case.

5.13 The Court found that it was difficult to distinguish documents produced for the purpose of litigation from those which gave general legal advice. The majority concluded that legal professional privilege, so far as it applied to government legal advice, was not restricted to documents relating to actual or possible legal proceedings. The majority view might be put in the words of Justice Brennan:

In any event, I should think that the public interest is truly served by according legal professional privilege to communications brought into existence by a government department for the purpose of seeking or giving legal advice as to the nature, extent and the manner in which the powers, functions and duties of government officers are required to be exercised or performed. If the repository of a power does not know the nature or extent of the power or if he does not appreciate the legal restraints on the manner in which he is required to exercise it, there is a significant risk that a purported exercise of the power will miscarry. The same may be said of the performance of functions and duties. The public interest in minimizing that risk by encouraging resort to legal advice is greater, perhaps, than the public interest in minimizing the risk that individuals may act without proper appreciation of their legal rights and obligations. In the case of governments no less than in the case of individuals, legal professional privilege tends to enhance application of law, and the public has a substantial interest in the maintenance of the rule of law over public administration. Provided the sole purpose for which a document is brought into existence is the seeking or giving of legal advice as to the performance of a statutory power or the performance of a statutory function or duty, there is no reason why it should not be the subject of legal professional privilege.¹¹

5.14 On the issue of policy advice, the majority of the Court determined that legal professional privilege could still apply to a document containing policy or administrative advice, provided the “sole purpose” (according to the test laid down in Grant v Downs)¹² of bringing the document into existence was the provision of legal advice. Justices Mason and Wilson stated that:

Matters of policy and legal advice may be intermingled in the one document ...... The appellant’s submission fails to appreciate that the sole purpose test is a test that looks to the reason why the document was brought into existence. If its sole purpose was to seek or to give legal advice in relation to a matter, then the fact that it contains extraneous matter will not deny to it the protection of the privilege.¹³

5.15 Even though the Commonwealth and NSW Evidence Acts, Part 3.1, Division 1, have replaced the “sole purpose” test laid down in Grant v Downs¹⁴ with a “dominant purpose” test, the majority decision in Waterford’s case concerning the purpose for which the advice was created would still apply. Legal professional privilege covers documents which are brought into existence for the dominant purpose of giving and receiving legal advice.

5.16 Justice Dawson dissented,¹⁵ developing an idea which he had advanced in Kearney’s case, namely, that there was a distinction between documents produced by government in the normal course of its operation and policy-making, on the one hand, and those produced for litigation. In the context of the questions which the Commission must consider, this distinction may be very important. Justice Dawson said:

Where, however, a government is engaging, not in the legal process, but in the purely executive function of decision-making, there is no reason connected with the administration of justice which could require that any advice which it may be given to assist it in that process should be kept confidential.¹⁶

5.17 His Honour divided the documents in question in that case into two categories.¹⁷ First, communications relating to general matters of policy, and secondly, documents created in relation to specific actual or apprehended litigation. While considering that documents in the second category clearly fell within the area of privilege, His Honour suggested that the more general policy documents did not, and that for any particular documents it would be possible to separate the legal advice from more general policy advice.¹⁸

5.18 On the basis of Waterford’s case, it can be concluded that, because of the broad scope of legal professional privilege in Australia, courts are unlikely, without statutory modification of the law, to distinguish between “legal advice” to government relating to actual or possible litigation which is analogous to the legal advice generally given to private clients, and the more general advice which Justice Dawson calls “policy advice”. Therefore, it is likely that any advice produced for the dominant purpose of providing legal advice to government could be subject to legal professional privilege.

SHOULD ADVICE TO GOVERNMENT BE SUBJECT TO PRIVILEGE?

5.19 There is an obvious argument that documents prepared in the course of advising the government and its agencies on the conduct of specific litigation, either actual or immediately anticipated, should be protected on the same grounds that a private person enjoys privilege of confidential communication with his or her legal adviser. The policy underlying this rule of legal professional privilege is that fair operation of the legal process requires candour of communication between clients and their legal advisers. In this respect, the government is in no different position from other litigants.

5.20 Nevertheless, a wide range of legal advice is provided by the Law Officers or the Crown Solicitor to the various branches and departments of government as to the scope of powers and discretions and as to the way in which those powers and discretions might best be exercised. At times the exercise of those powers and discretions may result in litigation, but in other cases it will not. Indeed, the function of such advice may specifically be to avoid the possibility of litigation. It could be asserted that the public has an interest in the way laws are interpreted and implemented by the executive branch of government, as those laws are made by Parliament on behalf of the public, and the legal advice ought to be in the public domain as much as the texts of the laws. Therefore, it could be argued that legal advice on such matters is qualitatively different from legal advice to private clients which the Australian courts find subject to legal professional privilege. This was the argument favoured by Justice Dawson in Waterford’s case, but rejected by the majority of the Court.

5.21 Justice Dawson also pointed out that documents relating to general policy might separately be subject to executive or public interest privilege and that when considering the scope of client legal privilege or legal professional privilege that possibility should be borne in mind. It could be argued that privileged advice should have only limited circulation. For example, advice which is subject to public interest immunity might be circulated to other parts of government but no further; and advice which is subject to “legal professional privilege” might not be circulated any further than the immediate client.

Can Ministers claim privilege against each other?

5.22 It seems that there is no basis upon which any Minister (other than the Attorney General in his or her capacity as legal adviser) or department could claim legal professional privilege against another Minister or department. If advice is furnished to one Minister he or she can make it available to all his or her colleagues, without any illegality or impropriety. The following section addresses some possible ways of dealing with the question of whether privilege can be claimed:

• by one government department or agency against another; or
• by government agencies, as against the public, in respect of legal advice circulated among departments.

5.23 If Ministers are regarded in the same way as members of a partnership,¹⁹ they are obliged to share information relating to the joint enterprise (of government), and notice to each is regarded as notice to all. It would not make sense to allow any single Minister to claim legal professional privilege for advice received against any other Minister. Withholding legal advice between Ministers may also have dire fiscal consequences should it result in a misuse of power or a breach of a Minister’s statutory duty.

“Common interest” privilege

5.24 The law may find that legal advice to government might be privileged on some ground other than legal professional privilege. The law does recognise, in addition to legal professional privilege,²⁰ a privilege enjoyed by those who have a common interest. This usually arises when a person is engaged in litigation where several other parties are also interested. The privilege is that of the client or those with common interest in the litigation.²¹ Common interest does not exist if the individual interests are selfish and potentially adverse.²² Partners probably enjoy this privilege against non-partners, but there appear to be no decided cases on this issue. A closely held or small corporation and its directors may have a common interest.²³ It is not necessary that the parties have a common solicitor,²⁴ nor is it limited to litigation or anticipated litigation.²⁵ It is not necessary to identify that the interest between the two parties is so close that they could have used the same solicitor.²⁶ Common interest privilege does not exist between parties when they fall into dispute.²⁷

5.25 Common interest privilege is distinguished from joint privilege in that it is privilege in aid of anticipated litigation in which several parties have a common interest.²⁸ One party may seek legal advice regarding a certain matter and then disclose the advice to others with an interest in the same matter. Such disclosure does not amount to waiver of the privilege if the other parties have a sufficiently common interest. The test for this is not rigidly defined.²⁹ All interested parties need not necessarily concur to waive common interest privilege. Waiver is determined by asking whether waiver by one party has made it unfair for the other parties with the common interest to maintain the privilege.³⁰

Joint privilege between partners

5.26 It would seem that if a partnership seeks legal advice about a matter concerning the partnership, all the partners would have a joint interest in the matter. Implicit in the relationship is the duty or obligation to disclose to other parties the content of the legal advice. Accordingly, no privilege would attach to such communications as between the partners, but together the partners are entitled to maintain the privilege as against the rest of the world. All the partners must concur before the privilege can be waived.³¹

A provisional view

5.27 In Chapter 3, the Commission formed the preliminary view that for the purpose of receipt of legal advice, Ministers and departments should be regarded generally as a single entity, and that legal advice given to any Minister, department, or public agency other than a business enterprise with an independent legal personality should prima facie be regarded as advice given to the whole of government, and as such, it should be available to all organs of government. The Commission is of the view that for these limited legal purposes, government is analogous to a partnership.

5.28 The Commission has formed the preliminary view that, in relation to legal advice concerning litigation, actual or possible, the government should not be placed in a different position from other legal persons. However, we see a possible distinction between legal advice concerning litigation and other legal advice which, while possibly arising out of potentially contentious circumstances, is of a more general or policy character. Such advice, as a statement of the law, may influence the behaviour of officials in the same way as a decision of the court. The Commission considers that there is some force in the argument that such advice should be made public. This would require legislation to give effect to the views expressed by Justice Dawson in his dissenting judgment in Waterford’s case.

ISSUES FOR DISCUSSION

Are there reasons for excluding advice from circulation:

(a) within government; or

(b) to the general public?

If so, should all such legal advice be so protected or should the protection only extend to certain categories? How would these categories be determined?

Should a distinction be made between legal advice of a general or policy nature and legal advice concerning actual or possible litigation? If so, how would this distinction be made?

What should be the basis for excluding certain information from circulation:

(a) it contains matters of legal professional privilege?

(b) it contains matters which it is in the public interest to keep confidential? or

(c) other grounds for protecting information?

1. Waterford v Commonwealth of Australia (1987) 163 CLR 54.

2. See generally T M Gault “Public Interest Privileges and Immunities” in P D Finn (ed) Essays in Law and Government: the Citizen and the State in the Courts (2nd ed, Vol 2, Law Book Co, Sydney 1996) at 243.

3. (1978) 142 CLR 1.

4. T G Cooper Crown Privilege (Canada Law Book Co, Ontario, 1990) at 8-14.

5. This is the effect of the Evidence Act 1995 (NSW) s 118 and 119 which codify and somewhat modify the common law.

6. (1976) 135 CLR 674 at 685, per Stephen, Mason and Murphy JJ.

7. s 118 and 119.

8. Eg Baker v Campbell (1983) 153 CLR 52, per Wilson J at 95; Deane J at 114.

9. (1987) 163 CLR 54. See also Austin v Deputy Secretary, Attorney-General’s Department (1986) 67 ALR 585.

10. (1985) 158 CLR 500.

11. Waterford v Commonwealth of Australia at 74-75.

12. (1976) 135 CLR 674.

13. Waterford v Commonwealth of Australia at 65.

14. (1976) 135 CLR 674.

15. Waterford v Commonwealth of Australia at 100-103.

16. Waterford v Commonwealth of Australia at 100.

17. Waterford v Commonwealth of Australia at 102.

18. Waterford v Commonwealth of Australia at 102-103.

19. See para 3.26.

20. See discussion at para 5.9-5.18.

21. Buttes Gas & Oil Co v Hammer (No3) [1980] 3 All ER 475; Bulk Materials Coal Handling Services Pty Ltd v Coal and Allied Operations Pty Ltd (1988) 13 NSWLR 689.

22. Ampolex Ltd v Perpetual Trustee Co (Canberra) Ltd (1995) 37 NSWLR 405 at 410.

23. Farrow Mortgage Services v Webb (1995) 13 ACLC 1329 at 1332 (NSW SC) per Young J; Pioneer Concrete (NSW) Pty Ltd v Webb (1995) 18 ASCR 418 at 423 (NSW SC) per Simos J.

24. Bulk Materials (Coal Handling) Services Pty Ltd v Coal and Allied Operations Pty Ltd (1988) 13 NSWLR 689 at 695; Bank of Nova Scotia v Hellenic Mutual War Risks Association (Bermuda) Ltd (“The Good Luck”) [1992] 2 Lloyd’s Rep 540 at 542; Rank Film Distributors Ltd v ENT Ltd I(1994) 4 Tas R 281 at 294 per Crawford J.

25. State of South Australia v Peat Marwick Mitchell (1995) 65 SASR 72.

26. Network Ten Ltd v Capital Television Holdings Ltd (1995) 36 NSWLR 289; cf Bank of Nova Scotia v Hellenic Mutual War Risks Association (Bermuda) Ltd (“The Good Luck”) [1992] 2 Lloyd’s Rep 540 at 542.

27. Re Konigsberg (a bankrupt); Ex parte The Trustee v Konigsberg [1989] 3 All ER 289; TIA Barca de Panama SA v George Wimpey & Co Ltd [1980] 1 Lloyd’s Rep 598 (CA); Leis Hoegh & Co P/L v Petrolsea Inc (“The World Era”) (No 2) [1993] 1 Lloyd’s Rep 363.

28. Buttes Gas and Oil Co v Hammer [1981] QB 223 at 243 per Lord Denning MR.

29. Farrow Mortgage Services Pty Ltd (in liquidation) v Webb (1996) 39 NSWLR 60 at 618-620 per Sheller J.

30. Attorney-General for the Northern Territory v Maurice (1986) 161 CLR 475 at 488. See also: Network Ten Ltd v Capital Television Holdings Ltd (1995) 36 NSWLR 275.

31. Farrow Mortgage Services Pty Ltd (in liquidation) v Webb (1996) 39 NSWLR 60 at 609-610 per Sheller J.