The Power of Privilege: An Overview
Privilege is one of the most important protections in English law. It is vital to safeguard client communications but can be easily lost through a mistake. This article offers a practical overview, looking at key cases to keep in mind.
Types of Privilege
There are three main strands:
- Legal advice privilege (LAP): Protects confidential communications between lawyer and client for the dominant purpose of giving or receiving legal advice
- Litigation privilege (LP): Protects confidential communications with third parties made for the dominant purpose of preparing for litigation that is reasonably contemplated
- Without prejudice privilege (WPP): Protects genuine settlement discussions in an existing dispute (Framlington v Barnetson [2007] EWCA Civ 502).
Exceptions to Privilege
WPP was described as “jealously guarded” by the Court of Appeal in Motorola Solutions Inc v Hytera Communications Corp Ltd [2021] EWCA Civ 11, but there are exceptions.
There are two different doctrines which apply to the different types of privilege. The iniquity principle is the exception for LAP and LP, and the exception for without prejudice communications is covered by the unambiguous impropriety principle.
Both mean that where the conditions are met, the communication will not be privileged.
Iniquity Principle
The iniquity principle sets out that LAP and LP do not apply where advice furthers a crime, fraud or conduct contrary to public policy. The Court of Appeal confirmed the principle in Curless v Shell [2020] ICR 431, stressing that ordinary employment law risk management is not “iniquitous.”
More recently in Al Sadeq v Dechert LLP[2024] EWCA Civ 28, the Court of Appeal held that, in deciding whether the exception applies, the decision maker must decide on the balance of probabilities whether there is indeed putative iniquity (at §98). Where iniquity had been evidenced, the standard was further expanded – there was no privilege in documents and communications brought into existence “as part of” or “in furtherance of” the iniquity.
Unambiguous Impropriety
The principle of unambiguous impropriety means that WPP cannot be used to conceal dishonesty such as blackmail or perjury (Unilever plc v Procter & Gamble [2000] 1 WLR 2436). The threshold is high, with robust negotiation falling outside what constitutes concealing dishonesty. In Garrod v Riverstone Management Ltd [2022] EAT 177 suggestions were made to terminate employment as part of settlement negotiations following G’s complaints of discrimination for pregnancy and maternity discrimination including bullying and harassment. The EAT held that termination was rather a way of resolving the issue and would not be sufficient to satisfy the Unileverdefinition of unambiguous impropriety. The EAT upheld the ET’s decision at first instance ruling that references in the Claimant’s particulars of claim and evidence to settlement proposals made by the employer at a meeting before the claim was issued should be removed because they were within the scope of WPP.
The EAT in Swiss Re Corporate Solutions Ltd v Sommer [2022] EAT 78 further confirmed the high bar for unambiguous impropriety. Where an employer makes ‘exaggerated allegations’, it may still be protected by WPP unless there is evidence of the ‘guilty party’s state of mind’. Provided there is a reasonable basis for allegations, the EAT held that such types of communications, while potentially threatening when settlement is involved, are not unusual in litigation.
Potential Problems
Provided the exceptions do not apply, the following should be borne in mind in practice:
Who is the “Client” in LAP?
LAP is restricted to communications between lawyers and clients. Where the client is an individual, the client will be the individual.
When the client is a corporation, it is less straightforward. The case law appears to have landed on a narrowly construed definition. The leading case is Three Rivers (No 5) [2003] QB 1556 which confirmed that the client is only those authorised to seek and receive legal advice on the corporation’s behalf. Those who are authorised simply to provide lawyers with information, by way of interviews in investigations, are not the ‘client’. Instead, these employees are thought to be third parties. Communications with those who are not the ‘client’ will not be privileged.
SFO v ENRC [2019] 1 WLR 791 has suggested, though, that this area of law is ripe for reconsideration at §§123 – 130. The restrictive definition of ‘client’ has left employee interviews excluded from lawyer-client communications, and subsequently excluded from protection under privilege. At §130, discussing Three Rivers (No. 5), Sir Geoffrey Vos C concluded that:
“If… it had been open to us to depart from Three Rivers (No. 5), we would have
been in favour of doing so. For the reasons we have given, however, we do not
think that it is open to us, so it is a matter that will have to be considered again by
the Supreme Court in this or an appropriate future case.”
For now, Three Rivers (No. 5) remains binding, confirmed in Al Sadeq v Dechert LLP (above). It will be up to the Supreme Court or Parliament to invoke changes to LAP issues.
Confidentiality in the Workplace
LAP and LP only exists if communications are confidential – confidentiality is a key requirement for both types of privilege. Loss of confidentiality will result in loss of privilege. Note, however, that confidentiality is not a requirement for WP communications.
Cases such as Simpkin v Berkeley [2017] EWHC 1472 (QB) and Taylor v Evans [2023] EWHC 934 (KB) highlight the gaps in the law when communications on IT systems may or may not be confidential, affecting whether an employee can assert LAP. In Simpkin, an employee used his work IT systems to seek legal advice. The emails were not deemed to be privileged as lawyer-client communications because the emails were created and stored on the employers’ IT system and thus not regarded as confidential as against the employer. The claimant had signed the employer’s IT policy which confirmed emails would be monitored by the employer and were the employer’s property.
In Taylor, though, emails were held to be confidential because the context made it clear the material was personal and privileged. A staff member at the Labour Party sent an email seeking legal advice. The Labour Party sought a declaration that the email was not privileged. The email relied upon was marked as privileged. It was found when the staff member, M, handed in their work computer for investigation. It was sufficiently clear to the Labour Party that the staff member, when handing over her laptop, had not intended to leave confidential information stored on the device, which included personal documents.
The two contrasting cases has left the legal position unclear regarding confidentiality on employer’s IT systems, and whether this affects privilege. It requires a fact-specific analysis.
Waiver
Confidentiality differs to waiver of privilege. Brennan v Sutherland City Council [2009] ICR 479 defined “waiver” – it is about reliance on privileged communication. Where a party relies on privileged communication, privilege has been waived. There is a secondary risk of collateral waiver, which seeks to stop parties selectively disclosing privileged material which may be misleading.
Dominant Purpose Test
When emails are sent to multiple recipients, including lawyers, privilege depends on the dominant purpose of the communication (Jet2.com v CAA [2020] QB 1027). Simply copying in a solicitor is not enough. The main purpose of each email has to be identified. Where emails are sent to a lawyer with a specific request for advice, they will be covered by LAP. Where there is a rolling series of communications, it is possible that, while there may not be a specific request for advice in every particular email, as a whole the dominant purpose can be perceived as for advice.
Where emails have the dominant purpose to obtain the view of non-lawyers, then the communications will not be privileged. This remains the case if there is a second-hand purpose of simultaneously obtaining legal advice in the future, and even if lawyers are copied in.
The dominant purpose test can similarly be applied to meetings, which can be split up into non-legal discussions and where the dominant purpose is to receive legal advice or give instructions. In applying the test to assess whether each part of the meeting is privileged or not, consideration should be given to whether there is more than a mere presence of a lawyer at meetings.
Takeaway Tips
- For legal advice privilege, clarify at the outset who is the ‘client’.
- Keep circulation of privileged advice narrow and controlled.
- Mark communications “Privileged and Confidential” to avoid future complications.
- Similarly, state clearly when discussions are “without prejudice”.
- Train clients and teams on confidentiality and waiver risks.
