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Privilege in documents prepared by foreign lawyers

In the full Federal Court case of Stewart v Australian Crime Commission[2012] FCAFC 151, the applicants for leave to appeal were Anthony Stewart, John Cornell, Paul Hogan and Rimfire Films Pty Ltd. Before the primary judge, Stone J, they had claimed privilege in documents prepared by lawyers in California obtained by the Australian Crime Commission (ACC) under warrant pursuant to s 29 of the Australian Crime Commission Act 2002 (Cth). They argued that the issue of privilege was to be determined in accordance with the law of California pursuant to the Australian choice of law rules. The ACC’s submission (accepted by her Honour) was that a choice of law issue was not raised in the proceeding, for the correct position was that whether the ACC had a right to inspect documents in which privilege was claimed was a matter of statutory interpretation to be resolved in accordance with the generally applicable principles and called for an inquiry only into rights that arose under the Australian law of privilege.

The full court held that Stone J was correct in accepting that argument of the ACC. Per Jagot and Bromberg JJ:

“As the respondent (the ACC) submitted, in the context of s 29 of the Australian Crime Commission Act, the question which arises is what legal professional privilege, as a matter of interpretation of the statute, is to be taken as not qualified and not abrogated by the general words in the statute. The answer is the Australian law of privilege which, as the respondent also said, affords privilege to communications with lawyers for the purposes of obtaining legal advice whether those lawyers be local or foreign, whether the law as to which they are advising be local or foreign, and whether the communication occurs here or somewhere else. Once this is recognised it is apparent that no choice of law rule can arise for the reasons the primary judge gave.”

The appellants also challenged her Honour’s rulings in relation to whether particular documents did attract privilege in accordance with Australian law. Those challenges were also unsuccessful. For example, one argument was that the primary judge had overlooked evidence about the extensive role played by entertainment lawyers in a mature entertainment industry. However, said Besanko J, her Honour, correctly, did not approach the matter by reference to a notion of what was a standard client and lawyer relationship but rather approached the matter by reference to what was legal advice and what was commercial advice and reached the conclusion that the requisite dominant purpose had not been established. There was no error in such an approach.

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