Claim for legal privilege over communications and draft reports not waived by service of expert's report

In brief - Communications continue to attract privilege because expert formed own conclusions

The Supreme Court has held in a recent decision that a claim for privilege in respect of communications between a party's legal advisors and an expert retained by the party, and draft reports prepared by the expert, was not waived by service of the expert's report.

Bank applies for access to documents produced on subpoena

In Traderight (NSW) Pty Ltd (ACN 108 880 968) & Ors v Bank of Queensland Limited (ACN 009 656 740) (No 14) and 13 related matters [2013] NSWSC 211, the Bank of Queensland applied for access to a number of documents produced by an expert in response to a subpoena served on her by the bank. The expert had prepared the report on instructions from the OMB parties (OMB).

Privilege claimed over draft reports and documents recording communications

OMB claimed client legal privilege in respect of:

• draft reports of the expert containing comments, requests or advice made by the OMB legal advisors and communicated to the expert
• draft reports of the expert created for the dominant purpose or with the expectation that those draft reports would be provided to the OMB legal advisors for the purpose of those advisors considering or providing comment or advice
• documents recording communications between the expert and the OMB legal advisors

Was it inconsistent to rely on expert's report while maintaining claim for privilege?

The issue before the Court was whether, pursuant to section 122 of the Evidence Act, it would be inconsistent for OMB to rely on the expert's report and at the same time maintain a claim for privilege.

Justice Ball set out the history of section 122 and noted that the meaning of "inconsistency" is informed by considerations of fairness between the conduct of the client and maintenance of the confidentiality.

His Honour observed that the fact that legal advisors have communicated with an expert and provided comments on drafts of a report does not mean the expert has not reached her own conclusions or relied on material that has not been disclosed in the report. In fact, it is of general assistance to the court when parties' legal advisors help experts to narrow the issues and present their opinions in an admissible and understandable form.

OMB held to be entitled to maintain claim for privilege

The court held that the privileged materials had not influenced the content of the expert's report in such a way that the service of the report was inconsistent with maintaining the privilege in those materials. Accordingly, OMB was entitled to maintain its claim for privilege.

Legal advisors should ensure that their input does not influence expert's conclusions

Relying on Justice Ball's reasoning, it will be important for legal advisors briefing an expert and wanting to maintain privilege over their communications, to ensure that the assistance and commentary provided does not influence the expert's conclusions. It is permissible for the legal advisors to test the expert's findings by raising factual or hypothetical issues which may cause the expert to alter their conclusions.

As long as the expert continues to form his or her own conclusions, all working drafts and communications passing between the expert and the legal advisors will continue to attract privilege.