Dexus Capital Investment Services Pty Ltd atf Dexus Diversified Infrastructure Trust A v Australia Pacific Airports Corporation Ltd

1. [1]

   The relevant background to this matter was summarised by Stevenson J in Dexus Capital Investment Services Pty Ltd atf Dexus Diversified Infrastructure Trust A, Australia Pacific Airport Funds & Australia Pacific Airports Fund No.4 v Australia Pacific Airports Corporation Limited [2025] NSWSC 519. For present purposes, it is unnecessary to repeat this summary.

2. [2]

   The first defendant, the second and eighth defendants (SAS defendants), the fourth defendant and the fifth and ninth defendants have each challenged privilege claims made by the plaintiffs over documents discovered by the plaintiffs in the proceedings. The challenges made to the plaintiffs’ privilege claims fall into two broad categories.

3. [3]

   First, it is said by the defendants that the plaintiffs have not adequately established their claims of privilege over a number of documents.

4. [4]

   Secondly, it is asserted that the plaintiffs have waived privilege over certain categories of documents by reason of the way they have chosen to conduct the proceedings.

5. [5]

   On 9 February 2026, I heard submissions from the parties in relation to the defendants’ challenge to the plaintiffs’ privilege claims. The resolution of this issue had some urgency. The matter is listed for a final hearing commencing on 7 April 2026. The number of documents over which the plaintiffs have claimed privilege is very large. If the challenges made to these claims are successful, identifying the documents captured by those successful challenges is likely to be time-consuming and, potentially, controversial. Any successful challenge could, potentially, result in a large number of documents being made available to the defendants for the first time. In light of these factors, and the close proximity of the final hearing, it was my view that the challenges to the plaintiffs’ privilege claims needed to be determined as quickly as was practicable.

6. [6]

   At the conclusion of the hearing, I indicated to the parties the views I had reached in respect of each ground of challenge. I directed that they forward to my Associate short minutes of order reflecting those views and – if agreement could not be reached as to how best to reflect those views in a single set of orders – to provide a single marked up set of orders identifying the points of difference between the parties, accompanied by submissions of no more than three pages from each party setting out their respective positions on the identified areas of disagreement.

7. [7]

   On 11 February 2026, the parties provided me with a document containing their competing short minutes of order, which, after ruling on several minor areas of disagreement, formed the basis of orders that I made on 12 February 2026, which are replicated in these reasons under the heading ‘Orders’.

8. [8]

   I set out below my reasons for making those orders.

Have the defendants established their privilege claims?

1. [9]

   The defendants say that, to sustain their privilege claim, the plaintiffs are required to prove all facts needed to establish that the claim is properly made: Hancock v Rinehart [2016] NSWSC 12 at [7]. This is correct. As the Full Federal Court observed in Barnes v Commissioner of Taxation (2007) 242 ALR 601; [2007] FCAFC 88 at [18]:

2. [10]

   On this basis, the formulaic assertions of privilege contained in the “privilege log” prepared by the plaintiffs in support of their claims are clearly insufficient – from an evidentiary perspective – to sustain them. However, the form and content of the privilege log has been shaped by the circumstances in which it came to exist.

3. [11]

   In November 2025, the parties exchanged correspondence addressing, inter alia, what was said by at least the first defendant to be an insufficiency in the basis identified by the plaintiffs in support of their privilege claims. In a letter dated 20 November 2025, Norton Rose Fulbright, the solicitors for the first defendant, proposed a process for addressing this aspect of the plaintiffs’ claims. That process contemplated a hearing on limited illustrative documents before the end of 2025 with the possibility of a further interlocutory hearing in 2026 should the proposed adjudication of the privilege claims over those illustrative documents fail to resolve any residual dispute in respect of the balance of the documents over which the plaintiffs had claimed privilege.

4. [12]

   Norton Rose Fulbright’s letter was accompanied by a table articulating in greater detail the defendants’ challenges to the plaintiffs’ privilege claims. Mr Arnott SC, who, with Ms Zhu and Mr Wilesmith, appeared for the plaintiffs, drew to my attention the fact that in relation to three of the five categories of documents in respect of which it was said there was an insufficient basis for the plaintiffs’ privilege claim, the letter noted:

5. [13]

   On 15 December 2025, the parties made submissions to Peden J in relation to a proposed approach for the determination of the plaintiffs’ privilege claims. After hearing from the parties, her Honour said:

6. [14]

   Following this hearing, Mr Jonathan Milner, the solicitor for the plaintiffs, caused two solicitors employed by his firm to prepare the privilege log. In an affidavit sworn on 23 January 2026, Mr Milner says:

7. [15]

   The defendants have persisted in their challenge to the plaintiffs’ privilege claims based on what is said to be the insufficient basis advanced in support of those claims.

8. [16]

   At the hearing before me, the first defendant observed that Mr Milner’s involvement in the process described in paragraphs 59 and 60 of his affidavit was more in the nature of an audit or spot check of the work done by others. The first defendant emphasised the fact that – since receiving Mr Milner’s affidavit – its continued agitation of this issue had resulted in the plaintiffs abandoning claims made in the privilege log over a number of documents. It is said – not unreasonably – that this fact casts doubt on the extent to which it can rely upon the exercise described by Mr Milner in paragraphs 59 and 60 of his affidavit to establish the plaintiffs’ privilege claims. I accept this.

9. [17]

   I should make clear that nothing in the above paragraph should be interpreted as any criticism of the task described by Mr Milner or the individuals who performed it. The privilege log identifies a vast number of documents. No doubt an even larger number of documents were reviewed during its preparation. Identifying which amongst these documents should be the subject of a privilege claim would have been a difficult exercise; no doubt – and quite reasonably – approached with an eye to avoiding the inadvertent waiver of privilege by the plaintiffs.

10. [18]

    Since providing the privilege log to the defendants, the plaintiffs and their legal representatives have acted properly in promptly abandoning the privilege claims made over documents identified in it whenever they have been persuaded by arguments advanced by the defendants that those claims cannot be maintained.

11. [19]

    The immediate question is how the impasse which has emerged between the plaintiffs and the defendants regarding the privilege claims the former maintains should be resolved.

12. [20]

    The first defendant has argued that – as the privilege log is insufficient to establish the plaintiffs’ claims – an identified range of documents over which the defendants maintain a challenge to those claims should now simply be produced. I disagree.

13. [21]

    The limited nature of the evidence adduced by the plaintiffs in support of their privilege claims is a product of the procedural history I have recounted. In light of this history, I consider it would be inappropriate for me to now find that – by reason of that limited evidence – the plaintiffs’ privilege claims are not established.

14. [22]

    In my view, the plaintiffs should be given an opportunity to properly establish their privilege claims to the extent that the defendants continue to challenge them. There are at least two aspects to this exercise. It may be necessary to review the documents which are the subject of the challenged privilege claims with a view to considering whether any inference about the dominant purpose of those documents can be drawn from their content. In some cases, this may be sufficient. In others, further information regarding the circumstances in which the documents were created may be required.

15. [23]

    Mr Arnott SC submitted, and I accept, that the exercise I have described may be extremely burdensome. It will no doubt prove to be an unwanted distraction at a time when the parties are preparing for the final hearing of the matter. However, neither of these considerations should prevent the defendants from challenging the plaintiffs’ privilege claims to the extent they consider it necessary and appropriate to do so in the context of the proceedings; mindful of their respective duties to assist the court to further the overriding purpose of facilitating the just, quick and cheap resolution of the real issues in the proceedings: s 56(3) Civil Procedure Act 2005 (NSW).

16. [24]

    No party suggested that I should undertake a review of the documents or otherwise embark upon the exercise I have described above. Rather, the parties accepted that it would be most appropriate for all disputed claims to be referred to an independent legal practitioner for resolution. That individual will be able to review the documents over which the challenged claims are made and receive such further information as the parties wish to advance in whatever form the independent legal practitioner feels is best suited to the fair and efficient resolution of any residual dispute.

17. [25]

    The parties having indicated that they could formulate a series of orders governing the process to be undertaken by the independent legal practitioner, I directed that those orders be included in the short minutes of order to be provided to my Associate. Orders addressing this process were included in the orders made on 12 February 2026.

The waiver claims

1. [26]

   The defendants assert that the plaintiffs have waived privilege over certain categories of documents by reason of the way they have chosen to conduct the proceedings.

2. [27]

   The principles to be applied in determining whether the plaintiffs have implicitly waived privilege over any particular communication or group of communications were not in dispute between the parties. Those principles were examined by the Court of Appeal in GR Capital Group Pty Ltd v Xingfeng Australia International Investment Pty Ltd [2020] NSWCA 266 at [57], where Macfarlan JA (with whom McCallum JA and Simpson AJA agreed) summarised those principles as follows:

3. [28]

   Before turning to the substance of this aspect of the defendants’ argument, I note that it addressed the issues of alleged waiver at a conceptual level and not by reference to any particular document or set of representative documents. Instead, the defendants contended that privilege has been waived over certain categories of documents and that, accordingly, the plaintiffs’ claim to privilege over any documents falling within those categories should fail. The specific categories over which the defendants contended that the plaintiffs’ privilege had been waived were identified in short minutes of order provided to me during the course of argument by Ms Holmes SC, who, with Mr Murray, appeared for the SAS defendants.

4. [29]

   The defendants’ approach to this aspect of the privilege argument was consistent with that favoured by Wigney J in Australian Competition and Consumer Commission the MasterCard Asia/Pacific Pte Ltd (No 3) [2025] FCA 1043 and Ball J in Grocon Group Holdings Pty Limited v Infrastructure NSW (No 2) [2023] NSWSC 1144. As Ball J observed in the latter case (at [30]):

5. [30]

   For the same reasons, I accept that it is appropriate for me to consider whether privilege has been waived over the categories of documents identified in the SAS defendants’ short minutes of order. However, in adopting this course, particular care must be taken to ensure that those categories:

   1. (1)

      are expressly confined to documents which are the subject of the implied waiver; and

   2. (2)

      are crafted in a manner which leaves no room for doubt as to which documents are captured by them.

6. [31]

   Otherwise, the practical benefits of addressing waiver by reference to categories rather than specific documents would be significantly outweighed by the risk of any consequent orders inadvertently capturing documents over which privilege has not been waived or merely provoking further disputation between the parties.

7. [32]

   I address each of the categories identified by the SAS defendants below.

8. [33]

   The SAS defendants asserted that privilege has been waived by the plaintiffs over the following documents or categories of documents:

9. [34]

   The document which is described in those proposed categories as the KWM Report is a legal review report prepared by King & Wood Mallesons (KWM) in connection with a transaction described as “Project Mercury” and dated 15 November 2024. It was made available to prospective buyers of shares in the “Target” company. Annotations on that document suggest that it was initially provided in a partially redacted form to prospective buyers but was intended to be provided in an unredacted form to any who became “preferred bidders”. I note three things in relation to the KWM Report:

   1. (1)

      it does contain KWM’s opinions on certain legal matters relating to the structure of the transaction described as Project Mercury, including as to whether the proposed transaction would trigger any pre-emptive rights;

   2. (2)

      those opinions are expressed to have been prepared by reference to a confined – and clearly identified – list of documents; and

   3. (3)

      the plaintiffs make no privilege claim in relation to the KWM Report or the opinions it contains. Nor is any privilege claim made over any of the documents which it identifies as forming the basis of the opinions it contains.

10. [35]

    The SAS defendants contend that – by making the KWM Report available to prospective buyers – the plaintiffs have disclosed the substance of all legal advice given by KWM:

11. [36]

    Relying on observations made by Wigney J in Mastercard at [98]-[99], the SAS defendants go further and say that this waiver of privilege by the plaintiffs extends not only to the KWM Report but to all communications created for the purpose of seeking advice on the topics captured by the above extract, all communications that record, refer to or reproduce any advice given by KWM in relation to those matters and all documents that might have been relied upon by KWM in giving such advice. I disagree.

12. [37]

    The opinions contained in the KWM Report are clearly confined. They are based upon a clearly identified series of documents over which no privilege claim has been made. I do not accept that by providing the KWM Report to prospective purchasers the plaintiffs have disclosed the substance of any other legal advice given to the plaintiffs by KWM on the issues referred to in the extract at [35] above.

13. [38]

    However, disclosure of the KWM Report has resulted in a waiver of privilege over all communications created for the purpose of seeking the KWM Report: see Mastercard at [98]. I have reached this conclusion not only because the maintenance of confidentiality in respect of such documents would be inconsistent with the disclosure of the KWM Report, but also because I consider such documents to be reasonably necessary to enable a proper understanding of its content: s 126 Evidence Act.

14. [39]

    Accordingly, I do accept that there has been a waiver of privilege over all communications created for the purpose of seeking the KWM Report.

15. [40]

    The SAS defendants assert that privilege has been waived by the plaintiffs over the following documents or categories of documents:

16. [41]

    At paragraph 33 of their Second Further Amended Commercial List Statement, the plaintiffs plead that:

17. [42]

    The plaintiffs seek to establish this pleaded fact through evidence to be adduced from Nicole Harris, the first plaintiff’s General Manager, Legal. In that evidence, Ms Harris has asserted that, at certain points in time, she had a particular understanding of certain relevant matters.

18. [43]

    Without rehearsing the detail of her evidence in these reasons, I note that the matters listed in (a) to (e) in the extract at [40] above are each relevant matters about which Ms Harris has claimed to have had a particular understanding of at certain points in time. I think it would be inconsistent and potentially productive unfairness for the plaintiffs to positively advance a case based on Ms Harris’ state of mind in relation to these matters while simultaneously maintaining a claim of privilege over any documents in which her views on those matters, at the relevant points in time, are recorded.

19. [44]

    Accordingly, I consider the plaintiffs to have waived privilege over documents expressly recording Ms Harris’ views on the following topics:

    1. (1)

       whether, as at October 2024, the Standard Deed Poll complied with the requirements of the Shareholders’ Deed;

    2. (2)

       whether, as at October 2024, the form of the Standard Deed Poll had previously been agreed by APAC’s shareholders;

    3. (3)

       whether, as at October 2024, the substance of the Standard Deed Poll was adequate to protect information shared as part of Project Mercury;

    4. (4)

       whether, as at 1 November 2024, the changes in the side letter with GIC Infra Holdings Pty Ltd had not altered the substance of the Standard Deed Poll; and

    5. (5)

       whether, as at 24 March 2025, the existing Deed Poll with the Dexus Wholesale Australian Property Fund (DWAF) would extend to cover DWAF’s access to the virtual data room for Project Mercury.

20. [45]

    The balance of the SAS defendants’ categories relating to the knowledge of Ms Harris rely on assertions made by her in contemporaneous correspondence as to her state of mind on relevant matters. That correspondence is included within the exhibits amongst the large body of documents referred to in Ms Harris’ affidavit evidence, but I was not taken to any particular passage of the affidavit in which she repeats these assertions as to her state of mind. I am not satisfied that the contemporaneous correspondence can properly be said to have been advanced by the plaintiffs to establish the facts pleaded at paragraph 33 of the plaintiffs’ Second Further Amended Commercial List Statement.

21. [46]

    In the circumstances, I consider these matters to be in a different category to those referable to evidence directly given by Ms Harris as her state of mind on certain issues. Without more, I do not think any unfairness arises from the plaintiffs maintaining a claim of privilege over documents (if any) recording Ms Harris’ views on issues she has merely referred to in contemporaneous correspondence that happen to have been included in the exhibits to her affidavit.

22. [47]

    The SAS defendants assert that privilege has been waived by the plaintiffs over the following documents or categories of documents:

23. [48]

    The conduct said by the SAS defendants to be inconsistent with maintaining a claim of privilege over documents falling within these categories arises from the denial by Mr Faulkner of allegations made against him in the proceedings to the effect that he made a range of misrepresentations or failed to disclose certain information which ought to have been disclosed by him in the context of his commercial dealings. In a short affidavit replying to the allegations made against him, Mr Faulkner variously asserts – in a somewhat formulaic manner – that he acted truthfully and in good faith “based on the information that I had available to [him] at the time and based on [his] honest understanding”.

24. [49]

    It is said that by responding to the allegations made against him in this way, Mr Faulkner has – using words borrowed from Allsop J in DSE (Holdings) Pty Limited v Intertan Inc (2003) 127 FCR 499; [2003] FCA 384 at [58] – laid open for scrutiny all of the information he had available to him at that time; including any communications over which the plaintiffs might otherwise have been able to maintain a privilege claim.

25. [50]

    I do not accept that the formulaic manner in which Mr Faulkner denied the allegations made against him has resulted in the plaintiffs adopting a position inconsistent with maintaining a claim of privilege over information which might have been available to Mr Faulkner at the relevant points in time. Nor that by referring – in an arguably inadmissible manner – to what is said by him to be the consistency of his actions with the information available to him, Mr Faulkner laid open for scrutiny any material over which the plaintiffs might otherwise have been entitled to make a privilege claim.

26. [51]

    Moreover, I do not think any unfairness arises from the plaintiffs’ decision to adduce evidence in response to these allegations. To the contrary, in my view it would be potentially productive unfairness if Mr Faulkner was precluded from responding to the serious factual allegations made against him unless the plaintiffs chose to abandon any legitimate claim to privilege over such information as might have been available to him at the relevant points in time.

27. [52]

    In any event, I am not satisfied that the proffered categories of documents formulated by reference to “information available to Mr Faulkner about” or “Mr Faulkner’s views on” the identified topics satisfy the requirements I have identified at [30] above.

28. [53]

    The SAS defendants assert that privilege has been waived by the plaintiffs over the following documents or categories of documents:

29. [54]

    These categories draw directly on the pleading in paragraph 33 of the plaintiffs’ Second Further Amended Commercial List Statement, which I have extracted above.

30. [55]

    In advancing their argument on these categories, the SAS defendants acknowledge that the plaintiffs seek to make out the pleaded facts by adducing evidence from Ms Harris as to her state of mind – in the sense I have discussed above – but say that the pleading goes further in that it is a positive assertion of not only Ms Harris’ subjective views but also the views of DCIL, the wider corporate entity.

31. [56]

    While on a strict reading of the pleading this is undoubtedly correct, the corporate entity’s state of mind must be established through a human actor. As I have noted above, the plaintiffs seek to establish this aspect of their pleaded case through evidence adduced from Ms Harris as to her state of mind at relevant times; it will stand or fall on an assessment of this aspect of her evidence. The extent of any implied waiver of privilege resulting from this aspect of the plaintiffs’ positive case should be assessed in this context. Viewed in this way, I do not think the plaintiffs should be taken to have implicitly waived privilege over a wider class of documents than those I have identified above in relation to what has been described by the SAS defendants as the Harris Waiver.

32. [57]

    In any event, without making some attempt to identify the person or class of people whose state of mind is said to represent the corporate understanding of DCIS or, I am not satisfied that the proffered categories satisfy the requirements I have identified at [30] above.

33. [58]

    The SAS defendants assert that privilege has been waived by the plaintiffs over the following documents or categories of documents:

34. [59]

    By this category, the SAS defendants contend that privilege has been waived over communications, the subject of which have been disclosed in the plaintiffs’ affidavits. It is suggested that by disclosing the substance of the communications, it is inconsistent to withhold those communications – or any other communications reasonably necessary to understand them – from production.

35. [60]

    Save for one potential issue I will return to shortly, there is no suggestion that the communications disclosed in the plaintiffs’ affidavits were themselves privileged in the sense contemplated by either of ss 118 or 119 Evidence Act. In these circumstances, it is not quite to the point that the substance of communications has been disclosed in the sense contemplated by s 122 Evidence Act. I do not accept that documents falling within the proposed categories are reasonably necessary to enable a proper understanding of the communications contained within the plaintiffs’ affidavits which are relied upon by the SAS defendants in seeking to make out this aspect of its waiver case: see s 126 Evidence Act.

36. [61]

    I also do not accept that the mere reference to a non-privileged communication in an affidavit thereby results in implicit waiver of privilege over any – otherwise privileged – document or communication which refers to or contains a record of that earlier communication.

37. [62]

    The one potential issue that arises in the context of this category is that Ms Harris is a lawyer, and privilege has been claimed over certain of her confidential communications made in this capacity. In these circumstances, and lest there be any suggestion that the relevant communications contained in her affidavit are otherwise said to be privileged, I’m willing to accept that there has been a waiver of privilege over:

    1. (1)

       documents recording the content of the meetings and conversations referred to in paragraphs 18 of the affidavit of Nicole Louise Harris sworn 23 September 2025;

    2. (2)

       communications between Mr Faulkner and Ms Harris prior to 4 March 2025 about the Standard Deed Poll.

38. [63]

    In paragraphs 39, 65 and 151 of her affidavit, Ms Harris gave evidence of searches that she undertook of records held by the plaintiffs and – at least insofar as she perceived to be relevant – the result of those searches. To the extent that she was doing this in her capacity as a lawyer, I am satisfied that any privilege which might have attached to the results of those searches (to the extent that they have not already been disclosed) has been waived.

39. [64]

    For this reason – and subject to a slight adjustment of its text – I am satisfied that privilege has been waived over the following categories identified by the SAS defendants: