What US GCs Should Know About Privilege in England and Wales

Introduction. The rules of privilege in England and Wales are broadly similar to US attorney-client privilege and the Work Product doctrine, but with a few material differences.

Privilege in England. As in the US, if an oral or written communication is privileged, a party has the right to withhold that evidence from opponents and the court, although the existence of privileged documents must be disclosed as part of the disclosure (discovery) process. There are four main categories of privilege: legal advice privilege, litigation privilege, common interest privilege, and without prejudice privilege.

Legal advice privilege covers confidential communications between lawyers and their clients that come into existence for the purpose of giving or obtaining legal advice. In England, as noted below, “client” is defined much more narrowly than in the US. For example, communications between lawyers and non-legal employees of clients, or with connected third parties, are unlikely to be protected by legal advice privilege, even where the purpose of those communications is to help lawyers provide legal advice to their clients, for example by gathering factual information necessary to provide advice.

Litigation privilege covers confidential communications made for the dominant purpose of existing, pending or reasonably contemplated litigation. It is much broader than legal advice privilege. It protects communications between lawyers and their clients, or between lawyers and third parties, as well as documents created by or on behalf of clients or their lawyers. The purpose of this category of privilege is to protect litigants’ ability freely to seek and receive advice, and to deal with disputes. A common issue is whether the dominant purpose test is satisfied for documents created during initial fact-finding investigations into a problem that leads to later litigation.

Common Interest Privilege allows two or more parties with a genuine shared interest to share privileged material (eg legal advice) without it losing its privilege. Close attention is often needed as to whether interests are sufficiently aligned legally to attract common interest privilege.

Without prejudice privilege protects communications between parties made in a genuine attempt to settle an existing dispute. Concessions made in such communications are not admissible as evidence against the party that made them. In England, the normal but not invariable rule is that the loser of an application or case must pay the reasonable costs of the winner. Communications that are “without prejudice save as to costs” can be deployed as evidence in disputes about liability for costs, and their amount. England has a system for formal settlement offers, with potentially significant consequences in costs and/or interest if offers are refused but not bettered.

In-house lawyers’ communications may require some caution. Privilege does not attach to business advice or administrative communications. The distinction between privileged and non-privileged communications is often blurred. It is advisable, where realistic, for in-house lawyers to keep advice given in their professional capacity as lawyers in separate communication streams to that of any general business advice, even where the two are connected. In contrast to the position under English law, communications between company employees and their in-house lawyers do not attract privilege under European Union law. Accordingly, particular care must be taken to protect privilege when seeking advice on competition/antitrust issues, as the European Commission will require disclosure of all such communications in the event of an investigation.

Waiver of privilege. Privilege can be waived expressly or impliedly. When sharing privileged information it is important that the confidentiality of privileged communication is maintained and that privileged information is only disclosed on the express basis that privilege has not been waived.

Key differences to US privilege

• Who counts as the “client” for legal advice privilege. The US definition of the “client” is broader than in England. In Three Rivers No 5¹the English Court of Appeal decided that only a limited class of employees with express or implicit authority to seek and receive legal advice on behalf of a company qualified as the client for the purpose of legal advice privilege. That meant communications with employees outside of that class did not attract privilege. This is a much narrower approach than that of the US Supreme Court in Upjohn Co v United States²
• “Internal Investigation” interview notes. In the recent case of RBS Rights Issue Litigation,³ the UK High Court held that notes of interviews conducted by RBS and its lawyers with employees and ex-employees as part of an internal investigation were not covered by legal advice privilege. The basis for the decision was that the interviewees were not within the definition of “client”. Those interviews took place in the US, and in the US notes of the interviews would likely have been treated as “attorneys’ working papers” and therefore privileged. However, the Court applied the law of England, as the forum for the dispute
• Communications with third parties. In the US, attorney-client privilege can cover communications with third parties if the purpose of those communications is to assist or enable the attorney to provide legal advice to the client. In England, for the reasons noted above, legal advice privilege would not cover such communications
• The US concepts of ordinary work product and opinion work product do not exist in England
• Limited waiver of privilege. In England, it is often possible to share a copy of a legally privileged document with a third party and maintain that document’s privileged status, provided that the disclosure was made for a specific and limited purpose. In the US any such disclosure to a third party will result in a loss of privilege

Notes

1. Three Rivers District Council v Governor and Company of the Bank of England (No 5)[2003] EWCA Civ 474
2. Upjohn Co v United States, 449 US 383 (1981).
3. Re the RBS Rights Issue Litigation [2016] EWHC 3161 (Ch)

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