Commercial litigation update - August 2026

The New South Wales Supreme Court has clarified that each individual email in an email chain must be assessed for privilege.

The Court’s decision arose from an application to maintain privilege over certain documents.  The Court set out several principles related to privilege and email chains:

• An email package is not a single indivisible unit. Each component in an email thread must independently satisfy the dominant purpose test. It is an error to claim, or to refuse, privilege over the whole thread as a block.
• A document does not acquire privilege merely because it is attached to, or transmitted under cover of, a privileged email. 
• The privileged character of the most recent email in a thread does not invest previous emails in the thread with privilege.

The Court noted that a copy of a non-privileged original email may attract privilege where that copy was brought into existence for the dominant purpose of obtaining advice (ie. the copy document itself must satisfy the dominant purpose test).  But, where the copy satisfies the dominant purpose test, the non-privileged original will not be clothed with privilege.

See: Perpetual Corporate Trust Ltd v Maneva Pty Ltd [2026] NSWSC 818
 
 

In a dispute between shareholders of a special purpose vehicle following an agreement to acquire and develop properties in Australia, the Supreme Court of Victoria has issued an ex-parte freezing order against non-parties (companies owned and operated by the defendants).  In doing so, the Court reiterated the fundamental principles for making freezing orders against a non-party under both the Court’s inherent jurisdiction and Order 37A of the Supreme Court (General Civil Procedure) Rules 2025 (Vic):

• a freezing order is a drastic remedy, made at the Court’s discretion;
• the applicant:
  • bears the onus of satisfying the Court that a freezing order should be made, on admissible evidence only; 
  • must establish that there is a ‘good arguable case’ against the respondent (ie. the claim has a real prospect of success); and
  • will ordinarily be required to provide an undertaking of damages (supported by security, if necessary);
• the rationale for a freezing order against a non-party, is to prevent interference with the administration of justice (ie. preserving assets from being dissipated);
• an inference that assets are at risk of dissipation can exist where evidence in the case involves serious dishonesty or wrongdoing, and is more likely to be drawn where the case involves fraudulent misappropriation of assets;
• evidence of serious dishonesty or wrongdoing must bear upon the risk of dissipation of assets; and
• the value of the assets covered by a freezing order should not exceed the likely maximum amount of the applicant’s claim, including interest and costs.

The Courts decision provides clear guidance on utilising freezing orders to ensure a party’s claim doesn’t result in a pyrrhic victory. 

See: Zhong & Ors v Yang & Ors [2026] VSC 449
 
 

Following a notice to produce requiring a party to produce invoices recording costs incurred, that were referred to in an affidavit in support of an application for security for costs, the parties fell into dispute as to the privilege status of those invoices.

The Federal Court of Australia noted that privilege is available where the content or nature of the privileged communication may be inferred from the document, even if not expressly revealed by it. The Court identified that whether an invoice is privileged depends on the details of the entries made in the invoice (ie. whether disclosure of the invoice would be tantamount to waving privilege in the underlying communications with which the invoice expressly or impliedly deals).

In this instance, the Court held that the evidence was sufficient to substantiate the claims for privilege.

See: Zulic v CMC Markets Asia Pacific Pty Ltd (No 4) [2026] FCA 878
 

In a proceeding commenced by ASIC, Harvey Norman has been fined a penalty of $35 million for advertisements the Federal Court of Australia held to be misleading and deceptive.

Between 1 January 2020 and 11 August 2021, Harvey Norman and Latitude Finance ran an advertising campaign that included several interest free promotions. The promotions did not disclose that in order to take advantage of the promotion, consumers were required to enter into a continuing credit contract with Latitude that was linked to a credit card account. 

At the relief hearing ASIC sought: (1) a penalty of $50 million against Harvey Norman and $35 million against Latitude; (2) an injunction restraining Harvey Norman and Latitude, and their agents separately or together, from engaging in further contraventions for a period of five years; and (3) adverse publicity orders against both Harvey Norman and Latitude.

The Court ultimately ordered: (1) a penalty of $35 million for Harvey Norman and $20 million for Latitude; and (2) the adverse publicity orders limited to publication on the websites of Harvey Norman and Latitude for a period of 90 days.  The Court refused to order the injunctive relief sought by ASIC.

See: Australian Securities and Investments Commission v Latitude Finance Australia (No 4) [2026] FCA 989

The Harman Undertaking is an implied undertaking that prevents the use of documents obtained through compulsory court processes outside of the proceeding in which they were produced.

In a dispute before the Federal Court of Australia, in which there were two separate proceedings to be heard together (one commenced by the applicants, and the other by the respondents), the applicants proposed to settle their proceeding against the respondents and offered a deed of settlement.  The respondents returned the deed to the applicants, signed on the respondents’ behalf and in the same form proposed by the applicants. The applicants then filed two affidavits in its proceeding.  The following day the applicants’ proceeding was discontinued, but the respondents’ continued.  The respondents then sought to use the affidavits filed by applicants in their proceeding.

While it was not known whether the deed was executed by the applicants before or after they filed the affidavits, the Court found that: (1) the applicants had it within their power to execute the deed and thereby compromise the dispute before filing the affidavits; (2) the applicants truly did file the affidavits voluntarily as they need not have filed them at all once the dispute was compromised; and therefore (3) the Harman Undertaking did not apply to the affidavits, allowing the respondents to use the affidavits in their proceeding.

See: Sandilands v Commonwealth Broadcasting Corporation Pty Ltd [2026] FCA 986