Background
Perpetual Corporate Trust Limited advanced a $6 million loan to Maneva Pty Ltd around October 2023, secured by a general security agreement and mortgage over a Barangaroo property owned by Janelle and Georgia Evangelo. When Maneva defaulted in January 2025, Perpetual commenced proceedings seeking judgment and possession. Janelle filed a cross-claim alleging undue influence and unconscionable conduct, seeking transfer to the Federal Circuit and Family Court to consolidate with existing family law proceedings between herself and her estranged husband Mario, Maneva’s director.
At the commencement of a transfer application before Faulkner J, affidavits from Ms Burrows (Maneva and Mario’s solicitor) and Mr Abdul Osman were served on the day of hearing. Janelle objected to portions as containing privileged communications. Faulkner J referred the privilege dispute to Sirtes J for urgent determination.
The Court’s Holding
Sirtes J held that the party claiming privilege bears the burden of proving the facts establishing privilege and must expose specific facts through admissible direct evidence, not mere assertion. Each component of email threads must independently satisfy the dominant purpose test; privilege does not attach to entire threads as a unit.
The court found that most of the disputed material lacked privilege because it was not prepared for the dominant purpose of obtaining legal advice or conducting litigation. Notably, Mr Osman’s emails to Janelle’s solicitors—containing factual information requests rather than legal advice—were not privileged. Janelle’s assertion of confidentiality and reliance on a table in her affidavit, without supporting evidentiary detail, was insufficient to establish privilege over paragraphs 6–12 and Annexures A–D of the Osman Affidavit.
However, Sirtes J held that Annexure E—legal advice from Janelle’s solicitors that Janelle forwarded to Mr Osman—remained privileged despite disclosure to this third party. Although privilege ordinarily waives upon disclosure to another person, the court found no waiver because Janelle and Osman shared a “common interest” in the outcome of the family law proceedings. Evidence showed Osman had financed Janelle’s legal fees ($66,350) with an understanding that he would be repaid from her anticipated FCFCOA settlement, aligning his financial interests with her litigation success. This common interest supplied a rational basis to infer Janelle intended confidentiality to continue, preserving privilege under Evidence Act s 122(5)(c).
Key Takeaways
- Bare assertions of privilege are insufficient; claimants must prove specific facts through admissible evidence regarding each disputed document and its dominant purpose.
- Email threads are not indivisible units; each email and attachment must independently satisfy the dominant purpose test for legal professional privilege.
- Common interest privilege can preserve privilege even after disclosure to third parties, provided the third party shares a genuine interest in the outcome of actual or pending litigation and the disclosure is made for a purpose relevant to that litigation.
- Financial interests aligned with litigation success—such as a litigation funder’s stake in recovery—can establish sufficient “common interest” to maintain privilege over disclosed communications.
Why It Matters
This decision clarifies the scope and limits of legal professional privilege in multi-party disputes, particularly where third parties financially support litigation. It reinforces that privilege is not lost merely because confidential material reaches another person, provided a common interest in the litigation’s outcome exists. For practitioners, it underscores the importance of meticulous evidence when asserting privilege claims and warns against filing broad privilege claims unsupported by factual particulars. The decision also provides guidance on the common interest privilege doctrine, confirming that informal arrangements—such as an interested party financing legal fees—can suffice to maintain privilege, without requiring formal litigation funding agreements.
The judgment’s approach to email threads and its requirement for document-by-document privilege analysis will be instructive for courts assessing complex email packages in discovery disputes. Critically, the court’s balanced approach protects confidential advice shared with interested third parties while rejecting wholesale privilege claims over entire affidavits lacking evidentiary foundation.