Legal professional privilege (LPP) is the fundamental right for clients in litigation to protect confidential communications with their lawyers from disclosure in court. Historically, it is almost universally acknowledged that this right is crucial to ensure that justice is done, and that clients and lawyers are able to freely discuss all aspects of a case without the fear of seeing such discussions used in a court of law.
Ordinarily, during litigation, both parties are required to disclose, to the other, all documents and communications that they intend to rely on, whether they are advantageous or damaging to their case. Documents must be disclosed unless they fall under a specific exception (such as LPP). If there is a dispute as to whether documents are privileged, the court, in closed session, will consider and rule on their status.
Three of the Kind
LPP can be split into three distinct areas:
(a) Legal advice privilege covers communications between lawyer and client which are confidential in nature and are conducted for the primary purpose of giving or receiving legal advice. The privilege will apply regardless of whether there is any actual or pending litigation.
(b) Litigation privilege is in addition to legal advice privilege, and will cover communications between the client and a third party, such as an expert testifying at trial, or external consultants. The key difference is that litigation privilege only applies if there is actual litigation, or a very high probability of it.
(c) Common interest privilege applies where privileged documents are shared with third parties who have a common interest in the shared information, such as a company and its shareholders.
Handle With Care
The right to LPP is not absolute and can easily be lost. The key to retaining LPP is confidentiality. If a client forwards an e-mail containing legal advice to a third party without marking it as confidential, all privilege will be lost. Marking it as confidential will not preserve legal advice privilege, but may allow the document to remain protected under litigation privilege. In addition, if a document that attracts LPP is inadvertently exposed, it can put the whole related class of documents at risk, as the court will not let the party pick and choose which documents are disclosed.
As a matter of good practice, and to ensure LPP is retained, legal advice should only be disseminated to a core team of identified individuals operating under strict instructions not to disseminate any privileged information outside that group (especially as e-mails and Blackberry messages count as “correspondence” that must be disclosed in litigation). During litigation (or before imminent litigation), written communications should be kept to a minimum, and all written exchanges should be clearly marked as confidential and legally privileged.
The Akzo Nobel Case
The rules on LPP under English law extend equally to both in-house (or industry) lawyers, and those in private practice (i.e. law firms). However, there is a twist. The European Court of Justice confirmed in the Akzo Nobel case that LPP does not extend to in-house lawyers who advise their employers in competition cases pursued by the European Commission. A majority of legal systems in Europe are based on codified civil law, rather than common law, where the principle of LPP is not accepted.
As such, in a competition case conducted against a company in the UK, whether or not LPP applies depends on whether the investigation is led by the Office of Fair Trading under the Competition Act, or by the European Commission. In cases where they act together, it is possible for communications to be privileged in one case and not privileged in the other. There is a great deal of debate on whether this is fair to UK in-house lawyers, but the position is highly unlikely to change any time soon.