Sometimes in disputes clients who have the benefit of positive legal advice may attempt to use that advice to inform the other side of how strong their case is. On occasion this involves forwarding on the advice to the other side, and sometimes it involves clients making statements such as “I am pursuing this case because my lawyers have said I have a strong case”. The risk of clients taking this course of action is that the other side may ask for that advice and, if the clients’ statements have gone far enough, then in some circumstances a Court may order that the legal advice be disclosed – this could be disastrous for the clients and is called a “waiver of privilege”.
What is “privilege”?
“Privilege” is essentially confidential information and/or communications which should not be disclosed to the other party in litigation. The most common forms of privilege are:
- Legal professional privilege – this is broken down into:
- legal advice privilege – this is confidential information which pass between a client and their lawyer, and which come into existence for the dominant purpose of giving or receiving legal advice about what should prudently and sensibly be done in a legal context; and
- litigation privilege – a confidential communication between a lawyer and client for the dominant purpose of litigation which is pending, reasonably contemplated or confidential.
- Joint privilege – two or more parties enter into a joint retainer with the same lawyer or have a joint interest in the subject matter of a privileged communication at the time it is created.
- Common interest privilege – where a third party has a common interest in the subject matter of a privileged document or in litigation in connection with privileged documents and/or communication.
- Privilege against self-incrimination – this exempts a person from being compelled an answer when called as a witness, produce documents or provide information which might incriminate them in criminal proceedings or expose them to a penalty.
For the purpose of this article, we are focusing on “Legal professional privilege”.
When is privilege waived?
In litigation sometimes privilege is inadvertently waived or, at the very least, is close to being waived by either the clients or their lawyer. In either scenario, the opposing party is likely to ask for a copy of the legal advice being relied on by the client – usually the client is not willing to hand over the actual legal advice, but simply wants to refer to how positive it is. That is when the Court has to decide whether privilege has been waived or not.
So when is privilege waived? The recent case of Clements v Frisby [2022] EWHC 3124 (Ch) summaries the law as follows:
- There needs to be a reference to the contents of the legal advice in question;
- It must be relevant to an issue which the Court has to determine; and
- The party who purports to waive privilege must have put forward a positive case/argument in reliance on the privileged material.
Therefore a party that argues that they acted in a certain way because of the legal advice they received, may have waived privilege and may be obliged to disclose to the other party all legal advice relating to the issue at hand (i.e. why they acted the way they did). However, a party that states “My solicitor gave me detailed advice. The following day I entered into the contract" will not have been deemed to waive privilege because that quotation is a reference to the fact that legal advice has been given, not a reference to the contents of the legal advice itself.
As the Court in Clements v Frisby found, whether privilege has been waived is extremely fact sensitive. There is no “one size fits all” and depends entirely on the facts.
Conclusion
There should never be an inadvertent waiver of privilege from either the client or their lawyer. Legal advice should not be used by clients as a bargaining chip because, as the Court in Clements v Frisby had to decide, it could result in all legal advice being disclosable – even any negative advice. This is likely to adversely affect the client’s case and is, quite simply, to be avoided at all costs.
The above being said, it can sometimes be beneficial to waive privilege if there is a tactical advantage to be had. Whilst rare, if the decision is taken to waive privilege, then it should be thought through carefully with lawyers so that the extent and scope of privilege being waived is managed carefully.