Legal Professional Privilege: Safeguarding Confidentiality for In-House Lawyers

Legal professional privilege is an essential principle of the legal system that upholds the confidentiality of communications shared between lawyers and their clients. This privilege serves as a foundation for fostering open and honest discussions between clients and their legal representatives, enabling them to receive the best possible legal advice.

Understanding Legal Professional Privilege

Legal professional privilege is a principle, recognized both under common law and statutory provisions, that protects the confidentiality of specific communications made in connection with seeking or providing legal advice or legal services. It is driven by the public interest in promoting unfettered discussions between clients and their lawyers.

Key Points to Know:

What is legal professional privilege?

Legal professional privilege is a common law and statutory principle that safeguards the confidentiality of certain communications related to the provision of legal advice or services.

Why does it exist?

Legal professional privilege exists to facilitate free and open discussions between clients and their lawyers by shielding these conversations from compulsory disclosure.

How does it help?

This privilege empowers individuals and organizations to resist mandatory disclosure of confidential communications.

What are the types of legal professional privilege?

There are two primary forms of legal professional privilege: common law privilege and statutory privilege under the Evidence Legislation. Common law privilege is similar to statutory privilege and encompasses advice privilege and litigation privilege.

When does common law privilege apply?

Common law privilege applies during pre-trial stages, except in jurisdictions like New South Wales (NSW), and in non-curial contexts such as search warrants.

When does Evidence Act privilege apply?

Evidence Act privilege generally applies when there are considerations of adducing evidence (i.e. at the trial stage). In NSW, it extends to pre-trial matters like documents produced under subpoena or pursuant to discovery.

Who is entitled to legal professional privilege?

The privilege is bestowed upon the client, not the lawyer. However, in-house lawyers can claim the privilege on behalf of their employer, who acts as the client.

Elements of Legal Professional Privilege:

• Common Law Privilege:
  • Confidential Communication
  • Involving legal adviser, client, or a third party
  • Dominant purpose of giving or receiving legal advice (or if made to conduct legal proceedings)
• Evidence Act - Advice Privilege:
  • Confidential Communication
  • Between Lawyer/Client, Lawyer/Lawyer acting for client, or in a confidential document
  • Made for the dominant purpose of giving or obtaining legal advice
• Evidence Act - Litigation Privilege:
  • Confidential Communication
  • Between client and someone, or lawyer and someone, or in a confidential document
  • Made for the dominant purpose of preparing for or conducting actual/anticipated litigation

Additional Privilege Considerations:

• Joint Privilege:
  • Applies when two or more people obtain legal advice together
  • No waiver of privilege unless all holders consent
• Common Interest Privilege:
  • Applies when two or more persons share a similar interest in communications with a legal adviser
  • Disclosure to a person with a common interest does not waive privilege

Understanding Legal Advice:

Legal advice, is not necessarily anything and everything that a lawyer does, it entails informing clients about applicable laws, prudent courses of action within a legal context, and providing professional advice in a capacity as a lawyer. It should be distinguished from financial, personal, commercial, or public relations advice. Sometimes, inhouse lawyers do provide commercial and policy related advice - that is something that is typically not privileged. 

Waiver and Exceptions to Privilege

Legal professional privilege can be waived expressly or impliedly. Express waiver occurs through voluntary disclosure, while implied waiver results from inconsistent actions that compromise privilege. However, certain exceptions to privilege exist, including communications made for the purpose of committing a crime or fraud, settlement negotiations (which may attract a separate privilege), and serving final proofs or evidence in legal proceedings - since once served the privilege may be lost.

Implications for Businesses and Individuals

Legal professional privilege plays a vital role in protecting confidential information and fostering candid exchanges between clients and their lawyers. It ensures that clients can freely seek legal advice without fear of their communications being exposed. Businesses, individuals, and non-government entities benefit from this privilege by maintaining confidentiality and obtaining frank and reliable legal counsel.

Challenges and Best Practices

While legal professional privilege is crucial, there are challenges to consider. Determining whether a communication is privileged can be complex, and exceptions to privilege further complicate the matter. To overcome these challenges, it is essential for in-house lawyers to:

• Recognize the potential for their communications to become part of a class action or royal commission-style inquiry
• Avoid using shorthand forms of communication that do not give enough context for a reader of that communication some years later to make a privilege call. This may just invite a dispute, and that escalates costs. 
• Delineate clearly between matters relating to legal advice and other non-privileged topics like employee onboarding, commercial advice, and policy matters. Only legal advice (and litigation privilege) will be safeguarded from production. 
• Consider confidentiality even for strictly irrelevant documents containing commercially sensitive information that can be redacted conveniently

Tips and Traps

1. Email chains: Assess whether other emails emails within a chain can be redacted when the host email is not privileged.
2. Mere labeling of an email as "Privileged & Confidential" does not automatically confer privilege. It must meet the necessary legal tests.
3. In-house lawyers providing commercial advice may risk losing privilege. Ensure clear separation between legal and non-legal matters.
4. Avoid disclosing the essence of legal advice to the opposing party, as it may waive privilege.
5. Confidentiality should be considered for commercially sensitive information. Such information may be redacted if an agreement is reached or orders are obtained permitting that course.

Getting Help

If you need help reviewing or considering matters considering legal professional privilege then consider involving us. We have assisted many inhouse lawyers and private practices with complex privilege calls and reviews.