Commercial litigation update - July 2026

This recent Federal Court decision serves as a timely reminder about privilege over third-party investigations and the documents created during such investigations which may be sought in subsequent litigation. 

In 2020, whistleblower allegations were made to Phoslock management about its international operations in the context of the audit of Phoslock’s financial statements. Phoslock appointed external consultants and lawyers to investigate those allegations. 

In a subsequent securities class action against Phoslock alleging the company misled the market in relation to those operations, disclosure was sought of reports produced by the external consultants as part of their investigations, including drafts and documents gathered during the investigations. Phoslock claimed legal professional privilege over those documents and that claim was challenged. 
When assessing those claims, Stewart J observed that the investigations were conducted for a variety of purposes including addressing organisational, reputational, regulator, accounting, personnel and commercial issues, and completion of the audit. He found that the evidence in the case did not reveal the nature, subject matter or timing of the legal advice sought which could be correlated to the scope of the investigations. Phoslock therefore failed to demonstrate that the disputed documents were created for the dominant purpose of obtaining legal advice and was ordered to produce them.

See: Cayzer v Phoslock Environmental Technologies Ltd (Privilege Dispute) [2026] FCA 800
 

On 2 July 2026, Federal Parliament passed laws amending the Australian Consumer Law. While the new laws do not come into effect until 1 July 2027, businesses should be taking steps now to review compliance and mitigate a variety of regulatory and litigation risks including, for example, consumer-based class actions. 

The changes include: 

1.  a general prohibition on unfair trading practices which manipulate consumers or distort the environment in which consumers make decisions, causing them detriment;
2. protections against unfair subscription practices, including requiring businesses offering goods or services under a subscription contract to improve information disclosure and simplify cancellation processes; and
3. disclosure requirements regarding ‘drip pricing’ (the gradual adding of fees during a transaction) which require a person offering goods or services at a base price to disclose information regarding transaction-based charges applying to those goods or services. 

See: Competition and Consumer Amendment (Unfair Trading Practices) Act 2026 here. 
 

The Full Federal Court has considered the implications of parliamentary privilege on the admissibility of evidence concerning proceedings in Parliament. 

The issue arose in applications brought by the Mining and Energy Union seeking orders under the “same job, same pay” scheme in the Fair Work Act. Those applications were brought for determination before a Fair Work Commission Deputy President who previously made statements about labour hire practices in Federal Parliament while serving as a Labor MP. In responding to the applications, the mining companies sought to have the Deputy President recused on this basis, seeking to put into evidence relevant extracts from Hansard in the House of Representatives by exhibiting them to an affidavit. 

The Court held that parliamentary privilege, which prohibits statements made in Parliament being used against a member in court, made the Hansard extracts inadmissible. In particular, the mining companies’ purpose in tendering the extracts to draw inferences or conclusions from proceedings in Parliament (in this case regarding the Deputy President’s good faith) went beyond the permissible use of proving the bare historical fact that something was said and was therefore proscribed by s16(3) of the Parliamentary Privileges Act 1987.

See: TESA Group Pty Ltd v Mining and Energy Union [2026] FCAFC 86

In a recent decision, the Full Federal Court reminds litigants of restrictions on reformulating their case on appeal. 

The case brought by ASIC against HCF Life Insurance Company Pty Limited concerned insurance products which contain exclusions relating to pre-existing conditions. HCF’s policy definition of “pre-existing condition” changed such that it no longer merely reflected the definition in the Insurance Contracts Act 1984 (IC Act). ASIC contended that the contract terms were unfair within the meaning of s 12BF of the ASIC Act. 

The primary judge found that ASIC conceded at trial that, in considering the question of unfairness of the contract terms, it was necessary to take into account the ameliorative effect of s 47 of the IC Act. Having done so, the primary judge concluded that contract terms do not cause a significant imbalance in the parties’ rights and obligations and are not unfair. 

On appeal, ASIC sought leave to withdraw the concession it made at trial. ASIC characterised this as a legal matter and contended that there would be no prejudice to HCF. 

The Full Court held that it would be contrary to the dictates of fairness and principle for ASIC to be permitted to reformulate its case on appeal in this way. The Full Court accepted that HCF was prejudiced in being denied the opportunity to reconsider its evidence had ASIC advanced, at trial, the case it now puts. 

See: ASIC v HCF Life Insurance Co Pty Ltd [2026] FCAFC 81

The Court of Appeal of the Supreme Court of Western Australia has affirmed that contractual provisions cannot modify statutory timeframes under the Building and Construction Industry (Security of Payment) Act 2021 (WA) (SOP Act). It highlights the need to carefully calculate the timeframe for responding to a payment claim and the consequences for non-compliance. 

In this case, the contractor, Martinus Rail, issued a $22.6 million payment claim to the principal, Co-Operative Bulk Handling (CBH), by email on a Saturday. CBH opened and read that email on the following Monday morning. CBH responded by issuing a $5.4 million payment schedule 15 business days after the Monday it opened and read the email (c.f. the Saturday when it was received by email). 

Under s 25(1) of the SOP Act, a principal has 15 business days to respond to a payment claim after it is made. If it is not disputed within that period, the principal is liable to pay the whole of the claimed amount. 

The issue that arose was whether CBH’s response to the payment claim was made within that 15-business day period, and when the payment claim received by email was taken to have been made. 

CBH argued that it was within time because:

1. the parties' contract stated that communications received after 5pm on a business day or a non-business day were taken to be received at 9am the next business day; and 
2. the contract could modify the commencement of the statutory 15-business day period because regulation 23(d) of the Building and Construction Industry (Security of Payment) Regulations 2022 (WA) (SOP Regulations) provides that when a document is sent by email, it is taken to have been given when it is 'taken to be received … in accordance with’ s 14 of the Electronic Transactions Act 2011 (WA) (ETA), and s 14(1)(a) of the ETA provides that the time of receipt of an electronic communication is when it becomes capable of being retrieved at a designated electronic address, 'unless otherwise agreed' (emphasis added). 

In deciding the date of receipt, the Court of Appeal observed that regulation 23(d) of the SOP Regulations provides that a document is received when it is under the recipient's control, and the recipient should have been aware of this. The reference in regulation 23(d) of the SOP Regulations to s 14 of the ETA only applies to the statutory rules in the ETA about the time of receipt and does not apply to the operation of an agreement about the time of receipt.

See: Co-Operative Bulk Handling Ltd v Martinus Rail Pty Ltd [2026] WASCA 82