Expense Reduction Analysts Group Pty Ltd v Armstrong Strategic Management and Marketing Pty Limited [2013] HCA 46 (6 November 2013): Practice and procedure, Discovery, documents subject to client legal privilege mistakenly listed as non-privileged in appellants’ Lists of Documents, privileged documents inadvertently disclosed to respondents’ solicitors

November 21, 2013 |

In Expense Reduction Analysts Group Pty Ltd v Armstrong Strategic Management and Marketing Pty Limited [2013] HCA 46 the High Court, in a unanimous decision, considered a dispute that arose in the discovery process, namely whether the inadvertent disclosure of documents for which privilege should have been claimed gave rise to a waiver.  The court however went much further and set its stamp on how it regarded such disputes should be handled.


The appellants were represented by Norton Rose Australia (Norton Rose).  The respondents were represented by Marque Lawyers (Marque). On 22 July 2011 parties to litigation in the Supreme Court of New South Wales were ordered to give discovery [3]. The discovery process involved approximately 60,000 documents [8]. Norton Rose used an electronic database to store documents. Fields were established within the database to describe document type and description. Those reviewing the documents coded them for relevance and privilege. The default position was not to claim privilege.

The persons reviewing the documents were told the client had instructed Norton Rose that client privilege was to be claimed in respect of all documents to which it was attached [9]. After the review a more senior solicitor conducted an audit of the reviewed documents by randomly checking the description of document against the list of documents. Some of the reviewers gave evidence that they must have made an error in failing to activate the yes instruction set the database defaulted to no privilege.  As a result the number of privileged documents, including the 13 in dispute, were listed as not privileged when in fact they should have been.  On 25 November 2011 a senior associate at Marque wrote to Norton Rose regarding inconsistencies whereby client legal privilege was being claimed with respect to some but not all communications [11]. Norton Rose responded on 6 November 2011 stating that the documents had been inadvertently marked as non-privileged but over which privilege was claimed and sought return all copies of those documents and an undertaking that they would not be relied on in the proceedings or otherwise [12] On 12 December 2011 Marque responded stating that its clients had no obligations to return the documents and any privilege attaching to them had been waived [13].

Application for injunctive relief to Supreme Court

The appellants applied for injunctive release relief . The court, per Bergin,was of the view:

that if the documents had been disclosed inadvertently, privilege would not have been waived. Conversely, her Honour’s view was that, absent a finding of mistake, disclosure would amount to a waiver of the privilege not to produce them.[16]

Her honour considered it was necessary for the appellants to establish that the reviewer had intended to claim privilege over each of the documents before considering whether a mistake had been made.  Claiming that a reviewer would not have formed the view that the relevant documents were not privileged was insufficient proof of an intention to claim the privilege [17]. On that basis she was not satisfied that the disclosure of four of the documents was inadvertent [18]. She found that 9 of the 13 documents in dispute were disclosed inadvertently because of the inclusion of duplicates of those documents in the privileged section of the List of Documents.

Court of Appeal

The Court of Appeal allowed the respondent’s appeal on the basis that the mistakes and disclosure in the discovery process would not have been obvious to reasonable solicitor. It stated, see [24], three principles may be applied for a privilege document which is mistakenly included in the lists of non-privileged documents, being:

  1.  where a document is mistakenly included by a party, the court will ordinarily permit that party to amend its List of Documents, under the rules of court, at any time prior to inspection;
  2. generally it is too late to correct the mistake by injunctive relief once another party has inspected the documents;
  3. injunctive relief may otherwise issue where inspection has been procured by fraud or where, on inspection, the other party or that party’s solicitor realised that the document was made available for inspection as a result of an obvious mistake. In either of these events the court has power, in its equitable jurisdiction, to grant an injunction to preserve the confidentiality of the communication.

The court, per Campbell JA, found that the privilege and the documents had been waived the reasons being:

Norton Rose’s sending of the documents was an intentional act carried out with knowledge that privileged documents may be withheld from production; that act was done in the context of a court-ordered discovery process, where the parties’ Lists of Documents were verified and certified; there was a lapse of time between the disclosure of the documents and the claim of mistake; and the mistake was not obvious… [27]



At the outset the High Court said that proceedings of this kind in length concerning a tangential issue should be avoided (seven)

Their Honours stated that it may be accepted that a continuing intention to claim privilege is relevant to the question of whether there has been a waiver of the privilege. However it was not necessary to prove a continuing intention that a reviewer formed an intention with respect to each document at the time it was listed. It was sufficient to prove that the party intended to maintain the claim to privilege and that the reviewers were carrying out their client’s instructions. As such the fact of mistake in the incorrect listing of the documents could be inferred. The evidentiary value of the correct listing of the 9 duplicate documents in the privileged section is to confirm, specifically, that their contrary listing as non-privileged resulted from an error and suggests, more generally, that mistakes were being made in the process [20].


The court summarised the principle of waiver as:

 ..an intentional act done with knowledge whereby a person abandons a right (or privilege) by acting in a manner inconsistent with that right (or privilege). It may be express or implied. In most cases concerning waiver, the area of dispute is whether it is to be implied. In some cases waiver will be imputed by the law  with the consequence that a privilege is lost, even though that consequence was not intended by the party losing the privilege. The courts will impute an intention where the actions of a party are plainly inconsistent with the maintenance of the confidentiality which the privilege is intended to protect [30]

Their honours found that issue of waiver should never have been raised [35]. It was no evidence of behaviour inconsistent with the claim for privilege such that a waiver could be imputed. In December 2011 Norton Rose dispelled whatever doubts Marque had regarding a claim of privilege when it advised that some of the privileged documents had been incorrectly listed as non-privileged [34]. The letter was sent promptly once Norton Rose became aware that a mistake had been made.

In reviewing the approach of English courts their honours noted that there are exceptions to the general rule that the onus is on the party giving discovery to ensure its accuracy. One exception is the court will permit a party was mistakenly disclose a privileged document to amend its list of documents [37].


Their honours made the following comments regarding discovery:

  1. discovery is a practice peculiar to common law systems, whereby parties to litigation can be compelled to produce to one another, for inspection and copying, all the documents in their possession or control which contain information that may assist another party to advance its own case or to damage the case of the disclosing party [44]
  2. it is not intended that it be allowed to affect a person’s entitlement to maintain the confidentiality of documents where the law allows [45].
  3. where a privileged document is inadvertently disclosed, the court should ordinarily permit the correction of that mistake and order the return of the document, if the party receiving the documents refuses to do so [45]
  4. it must be a process upon which other parties can reasonably rely. A party should make every reasonable effort to ensure the accuracy of the verified Lists of Documents which are to form the basis for inspection [46]
  5. The courts will normally only permit an error to be corrected if a party acts promptly. If the party to whom the documents have been disclosed has been placed in a position, as a result of the disclosure, where it would be unfair to order the return of the privileged documents, relief may be refused. However, in taking such considerations (analogous to equitable considerations) into account, no narrow view is likely to be taken of the ability of a party, or the party’s lawyers, to put any knowledge gained to one side. That must be so in the conduct of complex litigation unless the documents assume particular importance [49]

Approach required by the Civil Procedure Act

Their honours noted from Aon Risk Services Australia Ltd v Australian National University that case management is an accepted aspect of the system of civil justice administered by the courts in Australia. A different approach was required to tackle the problems of delay and cost in the litigation process. Speed and efficiency, in the sense of minimum delay and expense, are essential to a just resolution of proceedings. The achievement of a just but timely and cost-effective resolution of a dispute has effects not only upon the parties to the dispute but upon the court and other litigants. Aon confirmed as correct an approach to interlocutory proceedings which has regard to the wider objects of the administration of justice.

That included:

  • the intention and the expectation of the CPA is that the court use the broad powers to facilitate the overriding purpose. While parties continue to have the right to bring, pursue and defend proceedings in the court,  the conduct of those proceedings is firmly in the hands of the court. It is the duty of the parties and their lawyers to assist the court in furthering the overriding purpose [56].
  • the purpose  requires a more robust and proactive approach on the part of the courts. Unduly technical and costly disputes about non-essential issues are clearly to be avoided. The dictates of justice require that in determining what directions or orders to make in the conduct of the proceedings, regard is to be had in the first place to how the overriding purpose of the CPA can be furthered, together with other relevant matters. The focus is upon facilitating a just, quick and cheap resolution of the real issues in the proceedings, although not at all costs. The terms of the CPA assume that its purpose, to a large extent, will coincide with the dictates of justice [57]

Here the court should have moved promptly made a direction to permit Norton Rose to amend the list of documents together with consequential orders to the return of the disks [58].  This was a case of a mistake being made in the course of discovery.  It was necessary for the mistake to be corrected in the parties continued their preparation for trial [60].  There was no conduct on the part of Norton Rose which would have weighed against the grant of that relief [61] and there was no delay of any significance the mistake being notified or confirmed. The court said it was difficult to see what benefit the respondent could have believed to be obtained by them by attempting to retain the documents [62]. In reality there was no question waiver sufficient to be agitated before the court [63].

The court was very critical of what it described as “satellite interlocutory proceedings” which does not fulfil the overriding purpose of the CPA stating:

to the contrary, it is the very kind of conduct which should be avoided if those purposes are to be achieved. It involved a relatively minor issue relating to discovery, the resolution of which appears to have offered little advantage to the Armstrong parties. Its determination went no way towards the resolution of the real issues in dispute between the parties. Instead, it has distracted them from taking steps to a final hearing, encouraged the outlay of considerable expense and squandered the resources of the Court. [59]

The court specifically considered the solicitors responsibilities in discovery, in particular that a solicitors who is in receipt of privileged documents has a duty to return material, which is known or reasonably suspected to be confidential, where a solicitor is aware that its disclosure was inadvertent. That also involves notifying the other solicitor of the disclosures and returning that material [65]. The court pithily noted that such a rule should not be necessary [66] as “..in the not too distant past it was understood that acting in this way obviates unnecessary and costly interlocutory applications.”  This approach, the Court noted, is important in promoting conduct which will assist the court to facilitate the overriding purposes of the CPA [67].


The High Court made it clear that it regarded the approach of the respondent as unacceptable and the reasoning of the lower courts as being too technical and not approaching the issue in a realistic and practical manner consistent with the operations of the Civil Procedure Act.  The High Court effectively said that it should have been clear that a mistake had been made in the discovery process.  A complicated argument of proving whether there was an intention to waive a document missed the point.  The court showed clearly that, as with Aon, side fights over interlocutory disputes (which it described as satellite interlocutory proceedings) was inconsistent with the operation of the CPA.  The court did not upend the discovery process or change the law of waiver.  It made it clear to litigants in future that, as with Aon, the expectation was to deal with interlocutory steps in a robust way with little scope for arcane disputes on waiver.  The respondent’s solicitors approach of taking technical points in this case was roundly critisised.  It is likely to be a oft quoted decision on civil procedure.








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