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A controversial decision on ‘who is the client’ -always a live issue when advising a client with many employees and officers. Permission was refused to appeal this decision so it remains good law.

Longmore LJ said,

19. By the end of the 19th century it was, therefore, clear that legal advice privilege did not apply to documents communicated to a client or his solicitor for advice to be taken upon them but only to communications passing between that client and his solicitor (whether or not through any intermediary) and documents evidencing such communications. When Mr Edward Bray came to publish his book, Bray on Discovery (1885), he set out the object, meaning and scope of the doctrine of legal professional privilege in Part I of chapter II, by citing (inter alia) selections from the judgments of the following judges:

(1) Sir George Jessel MR in Anderson v Bank of British Columbia 2 Ch D 644…;

(2) Lord Langdale MR in Reece v Trye 9 Beav 316….;

(3) Cockburn CJ in Southwark and Vauxhall Water Co v Quick 3 QBD 315…;

(4) Sir George Jessel MR in Wheeler v Le Marchant 17 Ch D 675…;

(5) Turner V-C in Russell v Jackson (1851) 9 Hare 387, 391, itself citing from Greenough v Gaskell 1 My & K 98.

He then made his detailed exposition of the law by reference first to communication between client and adviser in sections I to IX of Part II of the relevant chapter and then, secondly, by reference to documents and oral communications having reference to (or connection with) existing or anticipated litigation in section X of the chapter “not being communications directly between the client and the professional legal adviser, or communication or documents standing on the same footing”: p 404.

20. This exposition is remarkably similar in form to that adopted by the distinguished signatories of the 16th Report of the Law Reform Committee (Privilege in Civil Proceedings) (1967) (Cmnd 3472) which, under the head of “Privileges in aid of litigation”, dealt first with “Communications between the client or his agents and the client’s professional advisers” and, thereafter, with communications with third parties if made for the purpose of pending or contemplated litigation.

It is noteworthy that the committee, in dealing with the first heading, entitles it “Communications between …”, and defines its true rationale as a privilege in aid of litigation. The committee does not suggest that the category of privilege with which it is dealing attaches, in the absence of pending or contemplated litigation, to any documents other than communications between client and legal adviser. To similar effect is Buttes Gas and Oil Co v Hammer (No 3) [1981] QB 223, 243f-244a, per Lord Denning MR and Halsbury’s Laws of England, 4th ed (Reissue), vol 37 (2001), para 579:

” Reports made by agents or employees to employer . Reports made by employees to their employers or by agents to their principals are not privileged unless they satisfy, and are privileged if they do satisfy, the conditions already set out, that is to say they must be reports made for the purpose of being laid before the party’s legal adviser for the purpose of obtaining his advice in connection with the anticipated or pending litigation.”

21 We, therefore, conclude that the 19th century authorities established that legal advice privilege was a well established category of legal professional privilege, but that such privilege could not be claimed for documents other than those passing between the client and his legal advisers and evidence of the contents of such communications.[Counsel 1]  made much play of the concession in the court below that it was not necessary for the communication to have actually been received before privilege could attach; if, for example, the sender of the communication had died before the communication had been sent to his legal adviser or the document concerned had been lost the privilege would still exist; but that concession is not inconsistent with the law as thus stated. If such a situation arose there would be no difficulty in saying that a document which was intended to be a communication between client and solicitor was still privileged even if not in fact communicated. That might be a modest extension of the principle but cannot be a foundation for the width of legal advice privilege which [Counsel 1] sought to maintain.

And

31. We therefore conclude that the Bank is not entitled to privilege in any of the four categories itemised at the beginning of this judgment. [Counsel 1] asked what the position would be if the Governor himself had noted down what he remembered in relation to the supervision of BCCI with the intention of giving it to the BIU for transmission to Freshfields. No privilege has been claimed for any such specific document but, as it seems to us, [Counsel 2] was right to say that on the evidence before the court, the BIU, which was established to deal with inquiries and to seek and receive Freshfields’ advice, is for the purpose of this application, the client rather than any single officer however eminent he or she may be. It follows that no separate consideration need be given to the position of ex-employees who are, obviously, in no better position for the purpose of any claim to privilege.

Edited for ease of reading. See also Privilege: Neuberger and Three Rivers (no.5) under this tag.

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