A recent Supreme Court of Victoria decision in Perry v Powercor Australia Limited provides warnings on the evidence required to maintain a claim for privilege where the dominant purpose of the communication or document is in question.


The plaintiffs brought representative proceedings against Powercor on behalf of a class of property owners in the area around Coleraine, Victoria. The plaintiffs claimed damages for breaches of statutory duties and general duties of care in relation to loss and damage to property as a result of the Black Saturday bush fires, which started on February 7 2009. The plaintiffs alleged that a faulty Powercor power line which passed over a farming property had started the bush fire and that Powercor had been negligent in its maintenance of the power lines.

Powercor claimed privilege over a number of reports in relation to the cause of the fire at Coleraine. The plaintiffs sought production of the reports on the basis that Powercor had failed establish that the reports were protected by legal professional privilege or that they had been created for the dominant purpose of provision of legal advice in contemplation of legal proceedings.

The four reports over which privilege had been claimed were as follows:

  • a report by Robin Hartrick entitled "Fire Investigation Report, Coleraine Fire 7 February 2009" (incorporating a transcript of a report by Dennis Clarke);
  • a report by Donald Bainbridge entitled "Asset Failure Investigation Tie Wire Coleraine SWER", dated March 10 2009, amended June 24 2009;
  • a supplementary report by Dennis Clarke entitled "Additional Calculations on an Effect of Unbalanced Span Length on Tie Behaviour"; and
  • a draft report by Ken Woolhouse entitled "SWER Line Tie", dated July 22 2009.

In support of its claim for privilege over the four reports, Powercor relied on an affidavit of its in-house solicitor, Ms Rands. When giving evidence, Rands had explained that as part of her role as legal counsel for Powercor, she had been required to commission and obtain reports to assist her in formulating her legal advice. She further stated that the reports had been created to assist any lawyers that might be engaged to act on behalf of Powercor, both in litigation and when providing legal advice to Powercor.

She had formed the view on February 8 and February 9 2009 that litigation against Powercor would ensue from the fires, and had discussed the legal implications of the fire with Powercor's chief executive officer (CEO). She stated that the CEO had asked her to arrange for an investigation into the fire so that she could give him legal advice on Powercor's overall exposure, given the allegations that the source of the ignition of the fires had involved Powercor's assets.

On February 12 2009, Rand stated that she had instructed Hartrick to investigate the fire at Coleraine and that, as part of his work, Hartrick had instructed Clarke to conduct an examination of the tie wires and to prepare a report. The wires were relevant to the allegations as to how the fire started. She stated that Bainbridge had then prepared a report for the purpose of giving Hartrick information in preparation of his investigator's report. Finally, she had been advised that in June 2009, Powercor's solicitors had instructed Woolhouse to prepare a report with respect to the tie wire. She had no further knowledge of that report.

In the course of its claim, Powercor did not arrange for evidence to be given by the CEO with respect to his meeting with Rands or his purpose in seeking an investigation. This decision proved fatal to Powercor's privilege claim.

At the time of the Black Saturday fires, Powercor had in place a written procedure for reporting and investigating asset failures. Under that procedure, if a failed item required investigation, an investigator was to be assigned to the task. The prescribed internal procedure required reporting to many individuals within the Powercor organisation for further action. In addition, Powercor was also obliged to report the incident to Energy Safe Victoria and WorkSafe pursuant to obligations it had under the Electricity Safety Act 1998. Those requirements include reporting on the cause of the fire.

Powercor had notified Energy Safe Victoria on Sunday February 8 2009 of the fire and stated that the cause of the incident was under investigation. Powercor had notified its liability insurers on February 9 2009. That same day, the royal commission into the bush fires was announced by the premier of Victoria. Three days later, Hartrick had been instructed to investigate the cause of the fire.

Powercor's evidence to the royal commission made reference to, and relied on, the four reports that were the subject of the privilege claim.

Position of the parties
The plaintiffs conceded that at the time that the reports were sought and prepared, legal proceedings against Powercor were anticipated by it. However, they argued that the reports were prepared for a number of purposes and that Powercor had not demonstrated that the dominant purpose for the creation of the reports was for the provision of legal advice or for use in anticipated or contemplated litigation. They submitted that in addition to the purpose described in Rands' affidavit, there were at least three other purposes for which Powercor might have obtained the reports, including:

  • to comply with its reporting requirements under the Electricity Safety Act 1998;
  • to inform its management whether its electrical distributing system had caused the fire, so that it could take the necessary steps as a part of its normal business operations; and
  • to assist it in dealing with the issues that would be raised in the royal commission.

Powercor accepted that was bound to comply with a number of statutory obligations, but argued that the reports came into existence in order for it to obtain legal advice to address a number of legal issues arising from the fire. It argued that the dominant purpose was satisfied by recognising from all the facts and circumstances that legal advice would be needed by Powercor for a number of different legal purposes, including satisfying its statutory obligations.


Justice Robson referred to a number of authorities that had previously stated that the dominant purpose must be determined objectively by the court, and that the evidence of the intention of the person who made or procured the report is not necessarily conclusive. He cited, with approval, the comments that had been made by the High Court in Esso Australia Resources Limited v Federal Commissioner of Taxation and by Justice Young in AWB v Cole, to the effect that it may be necessary to examine evidence concerning the purpose from persons in the hierarchy of decision making in order to identify the purpose or purposes for which reports are prepared.

Here, the failure by Powercor to call the CEO to give evidence was significant. The judge found that the failure of the CEO to give evidence in circumstances where it was central to the establishment of privilege gave rise to an inference that the evidence would not have assisted Powercor's claim to privilege. He noted that the plaintiffs sought to draw inferences from the surrounding evidence that Powercor needed the information for a number of purposes, not just to facilitate legal advice from Rands. He therefore argued that because the CEO, who had requested Rands to procure the reports, had failed to give evidence to rebut such inferences, the court was entitled to draw on them more readily.

Ultimately, the judge inferred that the reports were intended to be the source of information that Powercor used for its normal business purposes, including:

  • obtaining legal advice;
  • providing information to the royal commission;
  • satisfying its obligations under the Electricity Safety Act 1998;
  • providing information to its insurer;
  • complying with its internal reporting requirements; and
  • reviewing its maintenance programme.

In those circumstances, and in the absence of evidence from Powercor's CEO, the judge found that Powercor had not satisfactorily proved that the privileged purpose of commissioning the reports was the dominant purpose, and therefore ordered that the reports be produced to the plaintiffs.


The decision serves as a warning on the evidence necessary to demonstrate a dominant privileged purpose. Parties that attempt to resist the production of documents on the grounds of privilege may need to consider preparing multiple affidavits in support of their privilege claim, including from those at the top of the decision-making chain within the organisation.

For further information on this topic please contact Anne Freeman at Piper Alderman by telephone (+61 2 9253 9999), fax (+61 2 9253 9900) or email ([email protected]).