Ronald, Jamie --- "Case note: How to lose your client's privilege in devastating ways: Kaye v Woods (No. 2) [2016] ACTSC 87" [2017] PrecedentAULA 64; (2017) 142 Precedent 56

---

HOW TO LOSE YOUR CLIENT’S PRIVILEGE IN DEVASTATING WAYS: KAYE V WOODS (NO. 2) [2016] ACTSC 87

By Jamie Ronald

INTRODUCTION

In Kaye v Woods (No. 2),^[1] before Mossop AsJ of the ACT Supreme Court, privilege claimed over documents by a defendant in medical negligence litigation was lost because of the conduct of the defendant’s solicitors. It was held that a solicitor’s conduct in misleading the court and other lawyers was conduct sufficient to lead to the loss of the privilege.

THE LITIGATION

In long-running litigation arising from treatment she had received as a child in 2001, the plaintiff made a medical negligence claim against a surgeon and a hospital. The plaintiff had undergone knee surgery in a private hospital, and suffered a serious life-threatening post-surgical necrotising fasciitis.^[2] Her claim included allegations that the necrotising fasciitis was caused by the negligence of the surgeon and/or the hospital.

THE ISSUE

The surgeon and the hospital were separately represented in the proceedings, but had agreed that each would rely upon the expert evidence of Dr B J Hudson, an infectious disease physician and microbiologist, in relation to the allegations of negligence related to the infection.

The defendants had served three reports of Dr Hudson for the purposes of the hearing. The last of those three reports was dated 12 April 2013.

On 16 July 2014, the Court ordered the defendant to serve any further expert evidence by 22 September 2014.

In August 2014, the surgeon’s solicitor requested a further report from Dr Hudson. Dr Hudson provided a further report to the surgeon’s solicitors on or about 22 August 2014.

On 18 September 2014, the hospital’s solicitor contacted the surgeon’s solicitor about Dr Hudson’s evidence, and in October 2014 the surgeon’s solicitor told the hospital’s solicitor that the surgeon’s solicitors had spoken to Dr Hudson but decided not to get another report.

The hearing was due to commence on Monday 18 April 2016.

On Friday 15 April 2016, the solicitors for the surgeon served Dr Hudson’s 22 August 2014 report on the plaintiff and the hospital’s solicitors.

The second defendant had not seen the fourth report of Dr Hudson prior to its service on 15 April 2016.

The surgeon made an application to rely upon the report, notwithstanding its late service. In doing so correspondence was generated, an affidavit was made and oral submissions were made to the Court as to the reason for the late service of the fourth report.

The hospital and the plaintiff resisted that application and sought documents about the procuring of the fourth report.

Some documents, including the surgeon’s solicitor’s time records, were produced. The surgeon’s lawyers claimed privilege over other documents sought in the notice to produce.

The plaintiff made an application for production of the documents pursuant to s125 of the Evidence Act 2011 (ACT), which provides that privilege may be lost if, among other things, the documents over which the claim was made were created in furtherance of conduct that would lead to the imposition of a civil penalty.

The plaintiff asserted that:

(a) the surgeon’s lawyers had made representations to the hospital’s solicitors that the fourth report of Dr Hudson did not exist when it did;

(b) the surgeon’s solicitor’s assertions to the plaintiff’s solicitor that the failure to serve the report was an oversight was false or misleading;

(c) an affidavit filed in the proceedings repeating the assertion was false or misleading; and

(d) representations made to the Court by the surgeon’s counsel (in the presence of an instructing solicitor), that the failure to serve the report was an oversight, was also false or misleading.

The civil penalty said to be applicable was a professional disciplinary penalty imposed upon the surgeon’s lawyers. It was alleged by the plaintiff that the reasons a civil penalty may be imposed were analogous to those found in Legal Services Commissioner v Mullins (Mullins).^[3] In particular, a lawyer must not knowingly mislead an opponent in litigation, and must correct any misleading statement as soon as possible.

THE STANDARD OF CONDUCT

After setting out the factual matters disclosed by the materials that were otherwise known or from documents that were produced in answer to the notice to produce, Mossop AsJ set out, at [96], the standard of conduct that he considered to apply to the surgeon’s lawyers in assessing whether there was conduct sufficient to give rise to a civil penalty.

His Honour found that making a statement to another defendant’s lawyer, or that was false or misleading and known to be false or misleading, was conduct that would fall below an acceptable standard and expose a lawyer to a civil penalty. Similarly, relying on Mullins, he found that making a statement to an opponent’s lawyer in litigation that was false or misleading and known to be false and misleading would fall below the acceptable standard.

The conduct of the surgeon’s lawyers in the making of the affidavit and the representations made to the Court was then discussed by his Honour. In paragraphs [111] – [117], his Honour summarised the authorities as to a lawyer’s duty to the court. At [118] and [119] he said:

‘118 Therefore in civil proceedings where the other party is present there may not, in the absence of some additional obligation, be a duty of full disclosure of the relevant facts contrary to the interests or instructions of the client. However, the authorities referred to above make it absolutely clear that there is a duty of honesty which extends to avoiding misleading the Court...

119 That duty to be honest extends to not putting forward facts which are liable to, or which in fact, mislead the Court or the opponent. ... Further, it is a breach of duty to mislead the court temporarily. Therefore the fact that the true position is likely to emerge during the course of evidence is not sufficient to excuse a practitioner for misleading the court.’

The judgment went on to consider the role played by a solicitor who is present in court when counsel make misleading statements to the court upon the basis of the client’s instructions. At [139] his Honour said:

‘139 The obligation on a solicitor to correct misleading statements to a court must be at least as strict as that to correct statements made to another party during the course of a mediation. Therefore, the standard applicable to a solicitor instructing the court can be no less than that articulated in Garrett.^[4]

Mossop AsJ considered that the conduct of the surgeon’s lawyers was such as to justify the loss of client legal privilege pursuant to s125.

LESSONS TO BE LEARNED

This decision reiterates that lawyers must not knowingly or recklessly mislead or deceive other lawyers (whether they be your opponent or, as in this case, another party with a substantially common interest) or the court.

While it is well known that to do so may result in disciplinary proceedings with significant if not disastrous consequences for a practitioner’s reputation and career, the consequences for the client may be equally bad, and include the loss of privilege over documents that were subsequently the subject of misleading conduct.

Jamie Ronald is a Barrister at Burley Griffin Chambers in Canberra practising in medical negligence and personal injury law. He is the ALA’s ACT Branch President. PHONE [phone] EMAIL [e-mail].

---

^[1] [2016] ACTSC 87.

^[2] Necrotising fasciitis is caused by bacteria that enters the body through open wounds or small cuts and rapidly kills flesh and muscle.

^[3] [2006] LPT 12.

^[4] Legal Services Commissioner v Garrett [2009] LPT 12 (Garrett was the instructing solicitor to Mr Mullins at above note 3).