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Legal professional privilege: 2022 wrap up

This blog wraps up the key privilege updates for 2022 following on from the earlier post Legal professional privilege: 2022 so far. If you have not read that, it’s a good place to start. Two of the cases discussed in the earlier post have been to the Court of Appeal (spoiler alert: appeals dismissed).

Whilst this term has not seen the blockbuster decisions of recent years, the English courts have continued to grapple with thorny privilege issues, including on the issues of accidental disclosure, formalities for a claim of privilege, whether privilege can be backdated to documents following legal advice, and waiver.

Identity of those instructing lawyers (still) only privileged in the rarest of cases

In Loreley Financing (Jersey) No 30 Ltd v Credit Suisse Securities (Europe), the Court of Appeal affirmed Mr Justice Robin Knowles CBE’s determination that the identity of the claimant’s instructing lawyers was not privileged.

Lord Justice Males rejected the concept of a “zone of privacy” around the instructions to lawyers in the context of litigation. Rather, he held that privilege will only apply to the identity of the person giving instructions if disclosing their identity would make them unable to interact transparently with their lawyer and, as a result, unable to properly seek legal advice and prepare their case. This would apply where the identity of the person concerned would reveal or would tend to reveal the content of the privileged communications. The Court of Appeal was at pains to suggest that this will be a very unusual case indeed.

Solicitors prevented from deploying privileged materials against former clients

The Court of Appeal also dismissed the appeal in Candey Ltd v Bosheh, affirming that the iniquity exception did not permit a firm of solicitors suing a former client to deploy otherwise privileged materials, comprising communications in relation to preparing to defend the fraud claim in which the solicitors had acted for the client.

The Court of Appeal upheld the decision at first instance (covered in the earlier post), for the reasons of the trial judge: the privileged communications existed for the very purpose of preparing a defence and thus fell squarely within the solicitor-client relationship. They were not an abuse of this relationship. The iniquity exception thus did not apply.

The Court of Appeal also deprecated the solicitors’ argument, raised for the first time on appeal, that solicitor-client communications are not privileged in subsequent proceedings between them. If the information is not in the public domain, then the solicitor owes the client a duty to keep the information confidential and it therefore possesses the necessary quality of confidence to support a claim of privilege. The fact that the solicitor does not need to obtain disclosure of the documents, as they are in her possession, does not mean that privilege has no role to play. Rather, the client can rely upon privilege to prevent the solicitor using the documents without the client’s consent.

Refusal of injunction to prevent use of privileged material disclosed in error

The most interesting case of the term was Pickett v Balkind in which the High Court refused to restrain the use of privileged material disclosed in error.

In support of an application to adjourn the trial, the claimant had filed a witness statement from his solicitor which explained that an expert was unavailable. The statement referred to a letter from the expert which was exhibited which not only explained his unavailability but, unrelatedly, referred to the preparation of the joint memorandum including edits made by the claimant’s counsel, a “potentially serious breach of the TCC Guide”.

The defendant pointed this out leading the claimant to refile the application, removing reference to the letter, and applying to restrain the defendant’s use of the letter on the basis that it was privileged. After expressing some scepticism that portions of a letter revealing a potentially serious breach of court rules could be privileged, HHJ Matthews considered whether privilege, if existing, had been waived.

A key question, not settled by prior authority, was whether it mattered that the issue to which the disclosed privileged material was relevant went only to interlocutory matters and not the merits of issues at trial. The Judge concluded that it did not. The whole letter had been deployed in support of the application for an adjournment, even though it need not have been. Only information that was confidential as against the opponent could be privileged and that by deliberately disclosing information to an opponent, even for an interlocutory purpose, that information ceased to be confidential as against that party and thereby lost its privilege. Accordingly, privilege had been waived in the whole of the letter and no injunction would be granted.

Summarise legal advice at your peril

Thomas and others v Metro Bank plc and other (Re Ilya Yurov) provides a cautionary tale on the risks of waiving privilege.

A bankruptcy trustee sought an order for disclosure of bank statements under s. 366 of the Insolvency Act 1986. That application was supported by a witness statement which summarised legal advice on Russian law which justified the disclosure which was expressly on the basis that privilege was not waived. Whilst the trustees voluntarily provided an excerpt from the opinion, they refused to disclose it in whole.

The court found that this was not sufficient. The advice was deployed when the application was made leading to a waiver of privilege. The trustees were thus required to disclose the “whole of the material relevant to the issue in question” comprising that part of the advice and related communications, including the instructions, with respect to the relevant subject matter (Russian law of matrimonial property as it relates to monies held in bank accounts).

Although not stated expressly in the judgment, we note that this situation could, of course, have been avoided had the trustees filed expert evidence from the Russian lawyer, as would normally be expected of a party seeking to rely on evidence of foreign law.

Privilege to be judged at the time a document is created

In University of Dundee v Chakraborty, the Employment Appeal Tribunal held that legal advice privilege could not extend retrospectively to an original version of a report prepared by a workplace investigator which had been amended following legal advice.

The tribunal rejected the submission that a document that was non-privileged at the time it was prepared could later gain the protection of privilege simply because it had undergone legal scrutiny and amendment, and a comparison of the two documents could provide information as to the nature of that advice.

While a Scottish case, Lord Fairley stated that an English court would unlikely depart from the Tribunal if it were to rule on a similar set of facts.

Detail of privilege required in disclosure list

Finally, Tonstate Group Ltd v Wojakovski emphasises the duty of solicitors to adequately identify the basis for an assertion of privilege.

The parties had agreed an order for pre-action disclosure with the usual obligation for the disclosing party to identify categories of documents withheld from inspection. As is often the case, the respondent included only a general statement that documents were withheld on the basis that they were subject to legal advice and/or litigation privilege. The receiving party sought an order requiring further itemisation and explanation of these grounds.

Norris J referred to paragraph 3.2.5 of PD 51U (now PD 57AD), which requires legal representatives to satisfy themselves that claims of privilege are properly made and sufficiently explained. It was not sufficient for the solicitors to generically list privileged documents. Whilst it was not necessary to itemise every document, the law firm were ordered to itemise the documents by ‘tightly defined category’, not by individual document, and to require in relation to each such category the precise ground of privilege being asserted.

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