High Court Rules on Accidental Disclosure

In the recent High Court case of ERA v Armstrong [2013] HCA 46 the High Court deliberated on whether the Supreme Court of NSW should have requested that documents inadvertently disclosed during discovery should have been returned.

The parties had been involved in commercial proceedings in the Supreme Court since 2010 and had been ordered by the court in mid 2011 to give general discovery to one another. During the discovery process a number of documents were accidently disclosed in the non-privileged section of the appellants’ verified list of documents.

Upon discovery of the error, the applicant sought to recover the privileged materials and amend their list of documents. The respondent refused, arguing that privilege had been waived.

The High Court was left with two principal issues to consider:

1. Whether the Plaintiff had waived the privilege in the documents by mistakenly releasing the documents for discovery; and

2. The appropriate procedure for a Court to adopt where a privileged document had been inadvertently discovered.

On the first issue the court noted that, waiver must be an intentional act done knowingly whereby the person abandons the right or privilege by acting in a manner inconsistent with that right or privilege.

On the second issue the court referred to Rule 31 of the Australian Solicitors’ Conduct Rules which deals with the duty of a solicitor to return the material, which is known or reasonably suspected to be confidential and where a solicitor is aware that its disclosure was inadvertent.

In its unanimous decision for the applicant the High Court held that there was no need to resort to the Court’s equitable jurisdiction and if privileged documents are inadvertently disclosed during discovery, the Supreme Court should have promptly exercised these powers to permit the correction of any mistake.

The respondents were ordered to deliver up all hard copies of the documents in their possession and to delete all electronic copies and to provide written confirmation of their compliance with the orders.

The High Courts decision demonstrates the courts willingness to embrace the challenges associated with technological advances in large scale discovery and the acknowledgement that mistakes are inevitable.

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