Background
In ongoing litigation brought by Zulic and Tian against CMC Markets Asia Pacific Pty Ltd, CMC sought additional security for costs in the amount of approximately $8.6 million (in addition to $4.6 million already provided). CMC submitted invoices from its solicitors covering October 2024 to February 2026 in support of this application, disclosing only the front page showing total amounts charged for each invoice.
The applicants issued a notice to produce dated 18 June 2026 seeking production of 17 detailed invoices. They sought access to the invoices’ narratives—which describe work undertaken by fee earners, meetings, and actions taken—to enable their cost consultant to assess whether CMC’s claimed costs were reasonable. CMC resisted production on the ground of legal professional privilege, claiming the invoices’ detailed entries and narratives disclosed or would allow inference of privileged communications between CMC and its legal team.
The Court’s Holding
Justice Jackman held that legal professional privilege applied to the invoices and that CMC was entitled to resist production. The court affirmed the principle that privilege extends not only to communications that expressly reveal legal advice, but also to documents from which the content or nature of privileged communications may be inferred—including solicitors’ bills and invoices. The touchstone is whether disclosure would be tantamount to waiving privilege in the underlying communications.
The court found that Ms Farrant (CMC’s solicitor on the record) provided sufficient evidence through affidavit (sworn via Mr McCredie of her firm) that the invoice narratives contained records of work undertaken in a manner that either directly disclosed issues discussed in privileged communications or, when entries were read together in sequence, would enable inference of the content of privileged advice. The court accepted that redaction was not feasible given the varied way different fee earners recorded time entries and the risk of inadvertent disclosure while proceedings remained on foot. The court dismissed the applicants’ interlocutory application and ordered the applicants to pay CMC’s costs.
Key Takeaways
- Legal professional privilege protects not only the express content of solicitor-client communications but also documents from which privileged communications may reasonably be inferred, including detailed solicitors’ invoices.
- A solicitor’s high-level review and substantive engagement with document contents, communicated by affidavit, can suffice to establish privilege without necessarily requiring detailed point-by-point examination of every entry.
- Where redaction is demonstrably impractical or would create unacceptable risks of inadvertent disclosure of privileged information, wholesale privilege over the document may be justified.
- A party seeking to challenge security-for-costs claims must do so using information available to it; privilege does not yield merely because a party wishes to scrutinize opponent’s costs.
Why It Matters
This decision reinforces the scope of legal professional privilege in Australian litigation, particularly as it applies to solicitors’ time records and invoices. Many litigants seek detailed cost breakdowns to scrutinize opponent claims for security, but this case confirms that invoices describing legal work may themselves contain privileged information or enable inference of privileged advice. The ruling protects lawyer-client confidentiality while requiring only substantive (not exhaustive) evidence of privilege claims.
The decision is relevant to practitioners and parties in high-cost commercial litigation, cost disputes, and security-for-costs applications. It signals that courts will respect well-founded privilege claims over work narratives even when an opponent seeks to test the reasonableness of claimed legal costs, provided the claiming party demonstrates genuine engagement with the material and articulates a cognizable basis for privilege.