Federal Court: June 2025

PRACTICE AND PROCEDURE

Application for discovery of documents allegedly subject to legal privilege – whether sufficient evidence documents satisfy dominant purpose test – whether the Court should inspect relevant documents to determine privilege claim – principles of efficient case management

After standard discovery had been given in SMBC Leasing and Finance, Inc v Flexirent Capital Pty Ltd (Discovery) [2025] FCA 459, SMBC filed an interlocutory application contesting privilege claims made by Flexirent over more than 200 documents (at [8] and [10]).

SMBC sought discovery of three main categories of documents:

• ‘Category 2 documents’: internal communications involving Flexirent’s legal personnel over which privilege was claimed.
• ‘KWM documents’: communications with King & Wood Mallesons relating to legal opinions provided as conditions precedent to a financing agreement. SMBC asserted there was joint legal privilege over these.
• ‘Managed Services documents’: documents related to the operation and closure of a relevant third party’s Managed Services Financing business unit and mentioned in affidavits in the proceedings. SMBC asserted these were relevant to the present proceedings.

Regarding the Category 2 documents, Flexirent filed affidavit evidence in support of the privilege claims, including an affidavit from a partner at the law firm acting for Flexirent, outlining her review of the documents, categorisation of them and conclusionary evidence as to whether she considered them privileged (at [66], [69] and [74]). However, crucially, no evidence was filed by the authors of the disputed documents addressing the dominant purpose for their creation (at [74]).

The most interesting aspect of the decision concerned whether the Court, faced with limited affidavit evidence supporting the privilege claims, should inspect the documents in contest (i.e. the documents over which privilege was claimed) in order to determine whether they were privileged.

The following relevant principles were outlined regarding whether and when such inspection should occur:

• the power of inspection is at the court’s discretion (at [58]);
• inspection is not to be used as a substitute for evidence from the party asserting the privilege supporting the privilege claims (at [60]);
• similarly, the power of the court to inspect should be exercised to enable a claim to be scrutinised and tested, and not in order to facilitate proof by a claimant (at [52]);
• the material, which is in evidence, supporting the privilege claims should be considered before the court decides whether inspection is appropriate (at [54]). In that sense, it was said that ‘it first falls to be determined whether the respondents have sufficiently made out a case for establishing the relevant tests of privilege, so as to decide whether to inspect the documents’ (at [57]);
• parties should not assume that a judge will put themselves to the time and trouble of examining a multitude of documents if the relevant party cannot muster sufficient interest in the protection of its rights to provide an adequate affidavit in support of its claim (at [55]);
• the court should be aware of the inherent lack of procedural fairness which will be afforded to the applicant (i.e. the party challenging the privilege claims), because it cannot make submissions on the content of documents if it has not been able, as the court has, to inspect them (at [53]). In that regard, if the power of inspection is exercised, the court will need to recognise that it does not have the benefit of submissions or evidence that might place the document(s) in its proper context (at [56]); and
• principles of efficient case management can loom large, particularly where a large number of documents are in dispute, so long as it is not a case where the evidence ‘does not begin to establish’ a basis for a submission as to privilege (at [68] and [75]).

The Court upheld the privilege over the Category 2 documents and declined to inspect them. This decision was partly based on the fact the legal personnel held practising certificates and had legal responsibilities in the relevant period. The Court also trusted the review of the partner engaged by Flexirent, factoring in her considerable experience as a solicitor. That the documents were created at a time when legal advice would be expected also weighed in the respondents’ favour. In declining to inspect the documents, the Court emphasised the need to avoid unnecessary document-by-document inspection where reasonable inferences could be drawn from experienced legal review.

Despite the fact the KWM documents were addressed to both parties and SMBC had a joint interest in ensuring the legal soundness of the relevant transaction, the Court rejected the assertion of joint privilege. Flexirent alone retained and instructed KWM (meaning SMBC was a recipient of the opinions, not a co-client) and the opinions clearly stated that no solicitor-client relationship existed with SMBC. The Court relied on established principles that joint privilege requires more than shared receipt – it requires shared legal representation or a common legal interest at the time of creation.

The Court also denied discovery of the Managed Service documents, highlighting that just because documents are mentioned in affidavits does not make them relevant to proceedings. SMBC failed to show a relevance, that was more than contextual or tangential. However, the Court noted SMBC could seek these documents via subpoena or notice to produce if they could show a legitimate forensic purpose.

INDUSTRIAL LAW

Application for summary dismissal or strike out of statement of claim – whether characterisation of statute as a ‘workplace law’ under section 12 of the Fair Work Act 2009 (Cth) suitable for determination on interlocutory application.

In Gillham v Melbourne Symphony Orchestra Pty Ltd [2025] FCA 458, the Court dismissed a summary judgment application filed by Melbourne Symphony Orchestra (‘MSO’) and its Chief Operating Officer, Mr Guy Ross, seeking to dismiss the claim.

Background

The applicant, Mr Jayson Gillham, was an international concert pianist. He was scheduled to perform a recital on 11 August 2024 and one concert on 15 August 2024 with MSO in Melbourne.

The applicant performed Witness at the recital on 11 August. Prior to performing, he made remarks to the audience that Israel had killed more than 100 Palestinian journalists, the killing of journalists was a war crime in international law and it was done to prevent the documentation and broadcasting of war crimes to the world.

MSO subsequently gave notice to the applicant that his contract was terminated and the concert scheduled for 15 August was cancelled. The applicant was paid in full for both the recital and the concert but commenced proceedings claiming he was treated unlawfully. He claimed MSO took adverse action (within the meaning of sections 340 and 342 of the Fair Work Act 2009 (Cth) (‘FW Act’)) against him by terminating his contract, making a public statement following the termination of the contract and imposing a condition that he make no ‘physical or verbal statement from the stage’. He also claimed Mr Ross was liable as a person ‘involved in’ MSO’s unlawful conduct under s 550(1) of the FW Act (at [3]).

Summary dismissal application

When the proceedings were commenced there were four respondents: MSO was the first respondent; Symphony Services Australia Ltd (‘SSA’) was the second respondent; Ms Sophie Galais, the managing director of MSO, was the third respondent; and Mr Ross was the fourth respondent.

SSA was a respondent because the written contract about Mr Gillham’s performances was between the applicant and SSA. However, on 16 October 2024, the applicant discontinued his claim against SSA. Prior to the hearing of the interlocutory application, the applicant and Ms Galais reached a settlement and the Court ordered, by consent, the proceeding against Ms Galais be dismissed (at [8]).

In the interlocutory application, MSO and Mr Ross argued the applicant’s claim had no reasonable prospect of success because he had no protected workplace right that could ground a breach of s 340 of the FW Act. It was further contended that neither section 18 nor section 21 of the Equal Opportunity Act 2010 (Vic) (‘EO Act’), on which the applicant sought to rely, was a relevant ‘workplace law’ for the purposes of section 12 of the FW Act (at [10]).

The applicant argued the phrase ‘workplace law’ in s 12 of the FW Act should be given a different and wider construction and read in the context of the general protections provisions in Part 3-1 and the objectives of the FW Act (at 11).

Consideration

MSO and Mr Ross did not advance any different arguments in respect of their reliance on the power in rule 16.21(1)(e) of the Federal Court Rules 2011 (‘FC Rules’) (Cth) to justify a strike out of all or some of the pleading if the summary judgment application failed (at [12]).

With respect to section 31A of the Federal Court of Australia Act 1976 and rule 26.01 of the FC Rules, Mortimer CJ relied on her approach in Plaintiff M83A/2019 v Morrison (No 2) [2020] FCA 1198 at [46]–[52]. There was no dispute that generally the Court should approach its task under s 31A and r 26.01 on the basis that ‘[w]here there are factual issues capable of being disputed and in dispute, summary dismissal should not be awarded to the respondent simply because the Court has formed the view that the applicant is unlikely to succeed on [a] factual issue’ (Spencer v Commonwealth [2010] HCA 28 at [25] (French CJ and Gummow J)) (at [13]).

Her Honour stated this was not ‘a situation where the respondents rely on evidence which they contend is unanswerable or unanswered evidence of a fact fatal to the pleaded case and fatal to any case which might be propounded by permissible amendment: Spencer at [22]’ (at [14]).

Her Honour stated this observation assumed some significance in this case because the state and territory laws referred to in the definition of ‘workplace law’ in s 12 of the FW Act and their interaction with the prohibitions in Division 3 of Part 3-1 and s 351 of the FW Act, did not receive ‘a great deal of judicial attention’ and the existing authorities were not directly on point (at [16]).

For the purposes of the interlocutory application, MSO and Mr Ross also accepted that (at [18]):

• Section 18 of the EO Act is a state law that regulates the relationship between employers and employees within the terms of s 12 of the FW Act.
• The applicant’s status for the purposes of the FW Act (and the EO Act) was likely characterised as that of an independent contractor. That meant the applicant was an ‘employee’ within the extended definition of that term under s 4(1) EO Act where arrangements with independent contractors were within the meaning of ‘employment’.
• There was a triable issue as to whether SSA, in entering into the contract with the applicant, was acting as agent for MSO and not as principal.

The competing constructions

The applicant submitted that section 341(1) provided that ‘a person has a workplace right if the person is “entitled to the benefit of… a workplace law”’ (at [22]). ‘Workplace law’ was defined in s 12 of the FW Act. He further contended section 341(1)(a) concerned the nature of his workplace right which was his entitlement to the benefits of the political belief protections under the EO Act and the source of an alleged workplace right ‘not to be discriminated against by MSO’. He relied on the protection in s 340(1)(a)(i) and (ii) – that he had a workplace right which he exercised in presenting Witness and making the statement he did, and the adverse action descriptions in section 342(3) (a) and (b) with respect to the conduct of MSO and Mr Ross (at [33]).

MSO and Mr Ross, on the other hand, argued the applicant’s construction of ‘workplace law’ was untenable because the definition of a ‘workplace law’ in section 12 regulated the relationships between employers and employees. However, the EO Act was not a ‘workplace law’ that gave the applicant a ‘workplace right’ because the meaning and application of ‘workplace law’ under s 12 was restricted to common law employees and the applicant was not such an employee (at [34]). Section 335 of the FW Act provided that for the purposes of Div 3 of Part 3-1 of the FW Act (which included ss 340-342), ‘employee’ and ‘employer’ had their ordinary meanings and that was the meaning comprehended by the common law (C v Commonwealth [2015] FCAFC 113, Construction, Forestry, Maritime, Mining and Energy Union v Personnel Contracting Pty Ltd [2022] HCA 1) (at [36]).

MSO and Mr Ross also accepted that the applicant relied on item 3 of the table in s 342(1) as an independent contractor (at [47]). They relied on Tattsbet Ltd v Morrow [2015] FCAFC 62 and argued independent contractors cannot be considered employees and were not covered by the FW Act. However, Mortimore CJ rejected this contention and held that ‘the correct characterisation’ of the passages in Tattsbet should be determined at the trial (at [88]).

MSO and Mr Ross also submitted the FW Act adopted a specific definition of ‘employer and employee’, depending on which part of the legislative scheme was engaged. Section 340 did not operate mainly on the terms ‘employer’ and ‘employee’. Section 340(1) operated to prohibit certain conduct more widely but its width was constrained by the categories set out in the table in s 342. It was necessary for an applicant to bring his claim within one of those categories of adverse action in order for the prohibition in s 340 to be engaged (at [44]).

Her Honour accepted the applicant’s contentions that the breadth of paragraph (d) of the definition of workplace law in s 12 was susceptible to more than one constructional choice and, as the applicant`s claim was not ‘fanciful or plainly untenable’, it could not be rejected in a summary way under s 31A and should be determined at trial (at [59]).

The Court held that the proceedings involved ‘complex matters of fact and law’ about the proper characterisations of the relationship between MSO and Mr Gillham, as well as SSA, which needed to be considered against the evidence at trial (citing Personnel Contracting Pty Ltd at [64])) (at [95]).

Her Honour took the view that the applicant’s case was not without any reasonable prospect of success for the purposes of s 31A and accordingly dismissed the application. No orders as to costs were made. Her Honour also stated the Court would not permit the proceedings to turn into an ‘interlocutory war of attrition’, and should be closely and actively case managed by the Court, including with the assistance of the Registrar to whom the mediation referral was made (at [103]).