Kayler-Thomson v Colonial First State Investments Limited (No 3)

• Jurisdiction: Australia Federal only
• Court: Federal Court
• Judgment Date: 09 June 2023
• Neutral Citation: [2023] FCA 606
• Date: 09 June 2023

Federal Court of Australia

Kayler-Thomson v Colonial First State Investments Limited (No 3) [2023] FCA 606

File number:	VID 1313 of 2018
Judgment of:	COLVIN J
Date of judgment:	9 June 2023
Catchwords:	PRIVILEGE - application for production of documents for inspection - where respondent resists production on basis of claim to legal professional privilege - where proceedings concern conduct of first respondent as trustee of superannuation funds - where proceedings brought on behalf of members of superannuation funds - whether joint legal professional privilege exists between third applicant and first respondent as beneficiary and trustee - where disputed documents relate to time periods when the third respondent was not invested in the relevant option - where previous interlocutory application brought by the first applicant was dismissed - where first respondent maintains the previous decision is binding upon the third applicant - where first respondent alleges the doctrine of Anshun estoppel precludes new reasons being raised by the third applicant - consideration of structure of the Trust Deed - consideration of beneficiary’s interest in the trust - questions for determination adjudicated on basis that joint privilege exists
Legislation:	Superannuation Industry (Supervision) Regulations 1994 (Cth)
Cases cited:	D A Christie Pty Ltd v Baker [1996] 2 VR 582 Dyczynski v Gibson [2020] FCAFC 120; (2020) 280 FCR 583 Harvard Nominees Pty Ltd v Tiller (No 4) [2022] FCA 105 Kayler-Thomson v Colonial First State Investments Limited (No 2) [2021] FCA 854 Schreuder v Murray (No 2) [2009] WASCA 145 Shimson v MLC Nominees Pty Ltd [2021] VSCA 363 Tomlinson v Ramsey Food Processing Pty Ltd (2015) 256 CLR Zhang v Minister of Immigration, Local Government and Ethnic Affairs [1993] FCA 715
Division:	General Division
Registry:	Victoria
National Practice Area:	Commercial and Corporations
Sub-area:	Commercial Contracts, Banking, Finance and Insurance
Number of paragraphs:	84
Date of hearing:	8 December 2022
Counsel for the First and Second Applicants:	The First and Second Applicant did not appear
Counsel for the Third Applicant:	Dr KP Hanscombe QC with Ms AM Folie
Solicitor for the Third Applicant:	Slater & Gordon
Counsel for the Respondents:	Ms S Mirzabegian SC with Ms M Elliott and Ms M Caristo
Solicitor for the Respondents:	Herbert Smith Freehills

ORDERS

		VID 1313 of 2018
BETWEEN:	KEITH KAYLER-THOMSON First Applicant ; PETER CURRIE Second Applicant ; WENDY GIBSON Third Applicant
AND:	COLONIAL FIRST STATE INVESTMENTS LIMITED (ACN 002 348 352) First Respondent ; COMMONWEALTH BANK OF AUSTRALIA (ACN 123 123 124) Second Respondent ; AVANTEOS INVESTMENTS LIMITED (ACN 096 259 979) Third Respondent

order made by:	COLVIN J
DATE OF ORDER:	9 June 2023

THE COURT ORDERS THAT:

1. The answer to each of questions 1 to 5 in Annexure A to the orders dated 12 August 2022 is determined in the affirmative.

2. The first respondent pay the third applicant’s costs of and incidental to the determination of those questions in any event, such costs to be assessed if not agreed.

Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

REASONS FOR JUDGMENT

COLVIN J:

1. Ms Wendy Gibson is the third representative applicant in proceedings brought against Colonial First State Investments Limited (Colonial). Colonial is the trustee of the Colonial First State FirstChoice Superannuation Trust (Fund). Ms Gibson was a member of the Fund at material times.

2. The claims made against Colonial in the representative proceedings are in respect of the arrangements made by Colonial as trustee concerning the interest rates to be paid on some of the funds invested in the Fund that were held in term deposits with the Commonwealth Bank of Australia (CBA). Colonial is alleged to be a subsidiary and close associate of CBA. It is alleged that the interest rates that were arranged by Colonial were lower than those which would have applied if Colonial had been dealing with CBA at arms’ length in the same circumstances.

3. For present purposes, relevant allegations made against Colonial in the proceedings are to the effect that it breached its obligations to act in the best interests of the beneficiaries of the FirstChoice Fund, to act with care and skill, to avoid or manage conflicts of interest and to avoid obtaining a profit from the dealings.

4. Discovery has been given in the representative proceedings. Ms Gibson seeks orders requiring Colonial to produce for inspection a number of documents in respect of which Colonial claims legal professional privilege. It is common ground that legal professional privilege may not be invoked by a trustee against a beneficiary of a trust where the trustee and the beneficiary have a joint privilege. The issue between the parties is whether there is such a joint privilege in the relevant documents.

5. The parties have identified five documents from amongst the documents that Ms Gibson seeks to inspect on the basis that the resolution of the competing contentions as to those documents will resolve all relevant issues. On 12 August 2022, orders were made for determination of questions as to whether Ms Gibson shares a joint privilege with Colonial in each of the five documents.

6. I have previously considered a similar application by Mr Keith Kayler-Thomson who is another representative applicant in proceedings against Colonial concerning the interest paid on term deposits arranged by Colonial with CBA. One of the issues on that application was whether Mr Kayler-Thomson could rely upon his status as a representative applicant to claim joint privilege in circumstances where he could not establish that he personally held a joint privilege in the relevant documents. I determined that a representative applicant in a class action could not claim production of discoverable documents on the basis of a joint privilege that was held by members of the represented class but not held personally by the representative applicant: Kayler-Thomson v Colonial First State Investments Limited (No 2) [2021] FCA 854 at [72]-[87]. On the present application, the correctness of that proposition was not in issue because Ms Gibson relies upon her personal circumstances to support a claim to joint privilege in the relevant documents. For present purposes, they are materially different to those of Mr Kayler-Thomson.

7. Ms Gibson was added as a representative applicant after the determination of the previous application for production of privileged documents brought by Mr Kayler-Thomson. She was a member of the defined class of persons for the purposes of the representative proceedings at the time of that earlier application. However, the opt out procedure for the representative proceedings had not occurred at that time. The significance of that fact for present purposes is that a person who opts out will not be bound by the conduct of the common questions that are determined by the...