Contributing author: Michael Polorotoff, Lawyer.
Prior to the commencement of litigation, parties and their legal representatives frequently commission investigation reports into the circumstances giving rise to a dispute. It is often assumed that these reports are shielded from disclosure by legal professional privilege.
However, a recent decision handed down by the Supreme Court of Victoria is a timely reminder that privilege will only attach to pre-litigation investigation reports where they were obtained for the dominant purpose of providing legal advice and/or for the dominant purpose of using the reports in anticipated legal proceedings.
In Perry & Anor v Powercor Australia Limited [2011] VSC 308, Justice Robson ordered the disclosure of investigation reports obtained by Powercor following the devastating Victorian bushfires in February 2009. It was alleged that Powercor's faulty power facilities caused the fire.
In anticipation of legal proceedings being commenced, Powercor's in-house lawyer had commissioned investigation reports into the cause of the fire.
Once the litigation commenced, Powercor claimed privilege over those reports to prevent the disclosure of them to the plaintiffs.
The plaintiffs challenged that claim for privilege.
Justice Robson held that the reports were not protected by legal professional privilege.
His Honour found that Powercor had failed to establish that the dominant purpose for obtaining the reports was for legal advice and/or for use in the anticipated litigation. The reason for that conclusion was that there were many different purposes for which Powercor needed the reports including:
- to comply with its own internal incident reporting regime
- to comply with its statutory reporting requirements
- to provide information to its insurers
- to deal with the issues raised by the Royal Commission inquiry.
The Court was not satisfied that Powercor's "dominant purpose" for obtaining the reports was a privileged purpose.
In particular, the Court accepted that, in a corporate environment, it should look beyond the views of the lawyer who commissioned the report to ascertain "dominant purpose". The Court drew inferences adverse to Powercor because it failed to call its Chief Executive Officer to give evidence on the issue.
Accordingly, Powercor was ordered to produce the reports to the plaintiffs.
Conclusion
If there are multiple purposes for commissioning an investigation report, the party obtaining the report bears the onus of proving the "dominant purpose" was to obtain legal advice and/or for use in anticipated legal proceedings.
A failure to discharge that onus will cause the report to be "not privileged".
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
