February 3, 2020

Application of legal advice privilege is clarified

The Court of Appeal has handed down an important judgment clarifying the application of the dominant purpose test to legal advice privilege. The decision also contains helpful guidance on waiver of privilege, and observations on the difficulties that have been created by the narrow definition of the "client" in Three Rivers (No 5) [2003] EWCA Civ 474.

The first instance judgment

At first instance, the Court rejected a claim for legal advice privilege on the basis that the dominant purpose of the documents in question was to obtain commercial views within the organisation and not legal advice.

Grounds of appeal

Permission to appeal was granted on the following grounds:

  • Whether it was correct to apply the dominant purpose test to claims for legal advice privilege;
  • The proper approach to assessing legal advice privilege in multi-addressee communications;
  • Whether emails and their attachments should be considered individually or as a whole; and
  • The extent of the collateral waiver.

The dominant purpose test

Legal advice privilege applies to confidential communications between a client and their lawyer which came into existence for the purpose of giving or seeking advice in a relevant legal context. However, it has been a matter for debate for some time whether claims for legal advice privilege are subject to a dominant purpose test.  It is on this particular point that the Court of Appeal has provided welcome clarification, upholding the first instance decision of Mr Justice Morris.

The Court of Appeal observed that there is no direct authority on whether claims for legal advice privilege are in principle subject to a dominant purpose test, but that the balance of the authorities were in favour of a dominant purpose test being applied. Litigation privilege has long had the same test applied, and the Court saw no compelling rationale to differentiate between the two aspects of legal professional privilege. Accordingly, the Court considered that the judge had been correct to conclude that, in order to be protected by legal advice privilege, a communication must have been brought into existence with the dominant purpose of obtaining or giving legal advice.

Multi-addressee communications

The Court of Appeal considered that multi-addressee communications copied to both lawyers and non-lawyers could attract legal advice privilege in the following circumstances:

  • If the dominant purpose of the communication is, in substance, to settle the instructions to the lawyer, even if the lawyer is only copied by way of information;
  • If it is part of a "rolling series of communications" with the dominant purpose of instructing the lawyer;
  • Where there is a “continuum of communications” which includes a response from a lawyer containing legal advice (as the court will be "extremely reluctant" to engage in an exercise of determining the dominant purpose of individual documents in these circumstances); and
  • If the communication discloses the substance or nature of legal advice sought or given.

However, multi-addressee communications will not be privileged if the dominant purpose is to obtain the commercial views of the non-lawyer addressees, even if a subsidiary purpose is simultaneously to obtain legal advice from the lawyer copied to the communication.

Individual assessment of emails and attachments

The Court of Appeal considered that while an email and its attachment could be regarded as a single communication, it was correct to consider emails and attachments separately for the purposes of identifying documents that are protected by legal advice privilege. The rationale for this approach being that a document which is not privileged will not become so simply by reason of it having been sent to a lawyer. 

Collateral waiver

Having concluded that the documents were not privileged, it was not necessary for the Court of Appeal to consider the issue of collateral waiver.  However, the Court of Appeal observed that while the voluntary disclosure of a document may result in a waiver of privilege in that document, it would not necessarily result in a collateral waiver of privilege in all related documents.  In particular, the Court referred to the "transaction test": the need to ascertain the issue in relation to which the voluntarily disclosed document has been deployed because the waiver will be limited to documents that emanate from the same "transaction".

Three Rivers (No. 5)

On the specific facts, the Court of Appeal held that in relation to emails copied to both lawyers and non-lawyers, the non-lawyers were sufficiently senior to be treated as "emanations of the client" and therefore had the capacity to seek legal advice.  However, the Court alluded to the difficulties that had been created by the narrow definition of "client" in Three Rivers (No. 5), which does not reflect the practical realities of how large corporations instruct lawyers. 

General observations

The judgment provides helpful clarification as to the application of the dominant purpose test to legal advice privilege, and it also serves as a useful reminder of the potential dangers of sending multi-addressee emails to lawyers and non-lawyers. Privilege remains a complex area where care needs to be taken to ensure that privilege attaches to a document in the first instance, and that it is not subsequently waived. The judgment does not resolve the longstanding difficulties experienced by corporate bodies in claiming legal advice privilege. However, it is hoped that the Supreme Court will one day have the opportunity to do so, particularly given English law is out of step with international common law on this issue.

Co-author: Claire Harpur, Associate