Wednesday, 11 November 2015

Sprayworx Pty Ltd v Homag Pty Ltd [2014] NSWSC 833

“The communications and drafts of Professor [S]’s report do not need to be provided to Homag...The confidential documents belonging to [Sprayworx] are to be returned to its solicitors forthwith.”


The strength and defence of legal privilege in relation to draft expert reports and experts’ communications with solicitors is a contentious topic. This NSW Supreme Court judgment looks at whether communication of suggested changes to an expert is an implied waiver of client legal privilege over both the communication and the expert’s draft report. Legal practitioners should be aware of these matters both when seeking to suggest changes to an expert report, and when seeking access to legally privileged material from the other side.


Mr Pinto and Mr Kanios, of Sprayworx Pty Ltd entered into a contract to purchase a Diamond Wide Belt Sanding Machine with Homag Australia Pty Ltd. Sprayworx alleged that Homag supplied it with a defective sanding machine, engaged in misleading or deceptive conduct, and was negligent.

To establish Homag’s liability, Sprayworx relied on the reports of two experts; Professor S, with an engineering background, and Mr K, a forensic accountant.

Homag served notices to produce the draft reports prepared by Professor S, and the communications between both Professor S and Mr K and Sprayworx or its solicitors. Homag alleged that some of the communications influenced the expert opinions “in a way that requires disclosure.” Sprayworx claimed privilege over the documents.

Homag agreed that the documents of which they sought production were protected by client legal privilege, but contended that the privilege had been waived because the documents had been used in a way that influenced the expert opinions, which is inconsistent with privilege. Therefore, they argued, it would be ‘unfair’ for Sprayworx to rely on the final expert reports without disclosing the draft reports and communications, and disclosure was “reasonably necessary to understand the experts’ reports”.

Section 126 of the Evidence Act 1995 (NSW) allows for disclosure where it is “reasonably necessary to enable a proper understanding of the communication or document”.

Both Sprayworx and Homag agreed that the Court could inspect the documents claimed to be privileged to consider whether Sprayworx and its solicitors influenced the expert opinions “in a way that requires disclosure.”

The expert evidence

Professor S

Professor S was engaged by the solicitors for Sprayworx to provide an expert opinion on the operation of the sanding machine. He prepared two draft reports (dated 22 April 2013 and 31 May 2013, respectively), prior to providing a final report (dated 15 July 2013).

On 22 May 2013, after receiving the first draft report, the solicitors for Sprayworx wrote to Professor S requesting him to consider additional comments and instructions, and to amend his report if he believed that this was necessary. They enclosed new documents, including email evidence, job sheets and service history logs, recently provided by Homag; as well as ‘chiefly stylistic’ mark-up changes suggested by their barrister.

Homag submitted that these comments and instructions sought to “direct, influence and change, with respect to impermissibility, Professor [S]’s views.”

Mr K

Mr K was engaged by the solicitors for Sprayworx to prepare ‘reasonable loss and damage’ calculations based upon specific scenarios. He prepared a report dated 24 July 2013. The Court had ordered for the report to be served by 20 July 2013, but it was served late.

Homag contended that the delay was due to Mr K ‘changing his report,’ having been influenced by a letter of instruction provided by Sprayworx’s previous solicitors on 22 July 2013. This letter was part of the report, but Homag submitted that “without the benefit of the draft reports, the contents of the instructions given to the expert and his final report cannot be properly understood.” 

The Judgment

Associate Judge Harrison held that the purpose of the letter written by Sprayworx’s solicitors to Professor S on 22 May 2013 was to request him to make changes where he deemed them necessary in light of new documents and instructions, and with respect to the barrister’s mark-ups, accept the changes where appropriate. Therefore, her Honour could not “draw the inference that those comments by the solicitor could be said to influence the substance of Professor [S]’s final report.”

In relation to the letter written by Sprayworx’s previous solicitors to Mr K, providing him with further instructions, Her Honour found that there was “nothing contained in that letter that is in any way suggestive of an intention to influence the substance” of Mr K’s report. Her Honour could also not find that the solicitor’s comments influenced the report’s content in a way that its use would be inconsistent with maintaining the privilege in the documents, including it being unfair for Sprayworx to rely on the final report without disclosing the draft report and communications.

In addition, her Honour examined Professor S’s final report and held that it could be thoroughly understood without requiring the disclosure of the draft reports and communications between the Professor and Sprayworx or its solicitors.


This judgment reinforces that communicating with an expert to update instructions, provide further information, or suggest changes of form and admissibility, do not in themselves constitute an automatic waiver of privilege once the report is adduced.

This judgment, however, shows that there are actions for lawyers and experts in order to help reduce the risk of accidental waiver of legally privileged documents, such as:

  • Explicitly identifying the purpose of any draft report (when requesting one, or when delivering one).
  • Ensuring that the expert refers in his or her report to any information and instructions relied upon that were included in communications other than the instruction letter.
  • Ensuring that suggested changes for an expert report are just that: suggestions. Remind the expert to adopt them only where appropriate, and to maintain independence.
  • Identify explicitly changes that are required for admissibility. This will add clarity later if correspondence is to be produced.

Editor's note: This article was originally prepared with the assistance of Melvica Niranjan.