The ruling by Justice Neil Young is expected to delay the report of the eight-month inquiry into $290 million in illicit payments AWB made to the former regime of dictator Saddam Hussein.
AWB had asked the court to rule that 900 documents sought by Commissioner Terence Cole QC for his inquiry into the affair should remain secret because they contained legal advice.
While Justice Young ruled that some of the documents did have legal professional privilege, he said documents including interviews of AWB staff on their knowledge of inflated prices paid to Baghdad through Jordanian trucking company Alia must be handed over to the inquiry.
A United Nations investigation found that the company was a front for Saddam's regime.
AWB has claimed its internal reviews found no evidence it engaged in any wrongdoing.
Justice Young said the fact that AWB executives told this to the Cole Commission meant that documents showing this could no longer be protected by legal privilege.
The Cole inquiry has heard that in August 2002, AWB agreed to pay the Iraqi Grain Board (IGB) $US2 million in compensation for what the Iraqis claimed was a wheat shipment contaminated with iron filings.
AWB never paid the money because US-led forces toppled Saddam's government when they invaded Iraq in March 2003.
Today, Justice Young said 10 documents relating to this were not privileged because they were created for an improper and dishonest purpose - inflating wheat prices to extract money from a UN account to be used for the IGB compensation claim.
AWB and lawyers for the Commonwealth have been given three days to file an agreed minute of orders based on the judgment, and Justice Young is due to make formal orders on the documents on Monday.
Justice Young's decision is expected to delay Mr Cole's current reporting date of September 29 by weeks - possibly into early November - with the Commission set to resume public hearings as soon as possible to re-examine several witnesses.
The documents unlocked by Justice Young's ruling are unlikely to be made public before the hearings resume.