Legal professional privilege and legal advice privilege

June 8, 2020

By Bill Hanbury

Introduction and overview

Several recent cases have looked at legal professional privilege and one branch known as legal advice privilege. In particular:

  • The case of Addlesee v Dentons Europe LLP [2020] EWHC 238 (Ch) deals with legal professional privilege in the context of fraud or furthering crime;
  • Whereas DSM SFG Group Holdings Ltd v Kelly [2019] EWCA Civ 2256 dealt with legal advice privilege where a surreptitious recording was kept of between an in-house solicitor in a family company and an external solicitor engaged by the respondent and considered whether any use could be made of that recording;
  • In Raiffeisen Bank International AG v Asia Coal Energy Ventures [2020] EWCA Civ 11 the Court of Appeal considered confidential documents emanating between a finance company concerning funds for a transaction;
  • Finally, R ( Ltd) v Civil Aviation Authority [2020] EWCA Civ 35 looked at the “dominant purpose” test for legal advice privilege and the contrast between legal advice privilege and litigation privilege.

Because many practitioners find the categorisation of the different types of privilege under discussion difficult to understand, it is worth giving a thumbnail sketch of these before considering looking in greater depth at one of the cases, namely Jet 2, because it helps illuminate some of the key issues in this area of the law.

A thumbnail sketch of legal advice and litigation privilege

The purpose of legal advice privilege is to protect a client who wishes to obtain open advice in relation to a matter where legal advice is required.

Many authorities have emphasised the importance of the need for the advice to be unrestricted by fear of later disclosure. Hence, this privilege, as in other forms of privilege, is absolute. More importantly, it not only applies in relation to legal proceedings like litigation privilege but applies to all oral or written communications where the dominant purpose was the obtaining of legal advice.

However, a continuing developing area has been the extent to which communications with non-lawyers may be protected. If so documents/communications of any type, whether written or oral would be protected from disclosure. In a modern large commercial organisation, such as a multinational company, the lines of communication between lawyers and non-lawyers are often somewhat blurred and communications various types emanate from non-lawyers as well as lawyers.

As far as litigation privilege is concerned, this is often confused with without prejudice privilege but the two are logically completely distinct. It is always the case that a document which comes into existence from dominant purpose of pending, reasonably contemplated or existing legal proceedings is absolutely privileged. Again, the “dominant purpose” test applies.

Privilege of the two types under discussion is not simply a rule of evidence which may be raised in court proceedings but may be claimed by a client to resist investigation in certain circumstances by statutory authorities including the police. “Communications” are extremely widely interpreted to include for example a list of e mail addresses / contact details of the client (as in JSC BTA Bank v Ablyasov [2012] EWHC 1252).

The “Certain circumstances” where the blanket protection of privilege can be lifted tend to be strictly limited in legislation to certain well-defined circumstances and these are strictly policed by the courts.

Jet 2

The questions before the Court of Appeal in Jet 2 were:

  • Whether a document, in that case a press release issued by the CAA, had to have been created for the dominant purpose of seeking legal advice for legal advice privilege to be claimed? And, if so
  • What approach should the court adopt in deciding whether e mails between multiple parties including a lawyer were subject to such privilege?

The court decided that the dominant purpose test should apply to legal advice privilege just as it applied to litigation privilege.  Both were forms of legal professional privilege. The limbs were not fundamentally different as had been previously thought.

Given this conclusion, the majority of the  court did not consider it necessary to answer the second question but Hickinbottom LJ did provide some guidance as to whether to classify the e mails as privileged or not and looked at the scope of the “client” for this purpose.

As a result of conflicting authorities before the Court of Appeal in Three Rivers DC v Bank of England [No. 5] [2003] EWCA Civ 474 and Director of the SFA v Eurasian Metals [2018] EWCA Civ 2006 as to the approach to the definition of client for the purpose of  privilege, it is likely that this area will see a decision by the Supreme Court in the near future.

However, the Court of Appeal’s approach in Jet 2 is probably more in line with current thinking and there is has been increasing concern in recent years over the quirky English law on privilege (See for example the Thompson Reuters Litigation Blog “Anomalies in the English law of privilege: a triumph of form over substance”).

In particular, there remain a number of key difficulties in relation to privilege generally and the two types of privilege under discussion.  These include:

  • The extent to which communications with non-lawyers may be subject to privilege? To many it seems illogical that if the client happens to seek advice from his accountant as opposed to his lawyer this will often not fall within the definition of legal advice privilege.
  • What if an email relates only to other non-legal issues? If it forms part of a continuum documents, to which privilege attaches, then it will be privileged but if not, it will not be
  • What if the email happens to attach a document as opposed to containing a link to that document? In the former case, arguably, the actual copy document will not be privileged but the reference to the document will be!

These anomalies will continue to be the subject of discussion and debate. More importantly they will continue to generate satellite litigation given the importance of these issues, particularly in commercial litigation, to the outcome of the case.