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M5: Privilege and waiver
Law of jurisdiction in which disclosure is sought applies to determine whether privileged
"[169] To conclude my review of the relevant English cases, it seems to me clear that whether described as a rule, a convention or practice, it is the approach of the English Court to apply the lex fori to issues of privilege, and has been so since the mid-19th century." (The RBS Rights Issue Litigation [2016] EWHC 3161 (Ch), Hildyard J)
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- And whether it has been waived
"[38] As for the ruling in the US courts and the Australian courts that privilege has been waived, that depends on the domestic law of those countries as interpreted and applied by their courts. In this case this court is only concerned with the position under English law. As Aldous LJ said in Bourns Inc v. Raychem Corp [1999] 3 All ER 154 at 167h privilege is not lost under English law because it cannot be claimed in another country:
"To suggest otherwise would mean that a court, when deciding whether to uphold a claim for privilege, would need to be informed as to whether privilege could be claimed in all the countries of the world…….The fact that under a foreign law the document is not privileged or that the privilege that existed is deemed to have been waived is irrelevant. The crucial consideration is whether the document and its information remain confidential in the sense that it is not properly available for use. If it is, then privilege in this country can be claimed and that claim, if properly made, will be enforced."
[39] In my judgment, similar considerations apply when determining whether documents, which are no longer privileged, have ceased to be so as the result of voluntary waiver of privilege or otherwise." (British American Tobacco (Investments) Limited v. USA [2004] EWCA Civ 1064)
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No adverse inference
"[52] It follows that, in my judgment, the claim for privilege is properly made. In that event I refuse to draw any adverse inference from the fact that Techint has claimed it. The privilege exists for good reason; the exceptions have been developed to protect others in cases where such protection is needed. If adverse inferences are drawn in cases where the privilege, not the exception, applies then it will undermine the privilege itself. Thus to draw such an inference would be contrary to the very public interest the privilege is intended to serve." (China National Petroleum Corporation v. Fenwick Elliott Techint International Construction Company [2002] EWHC 60 (Ch)).
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Confidentiality is a pre-condition of privilege
“[The claimants] have had the attendance notes…since May 2013. On top of that, [the defendant] has recently included the relevant documents in his list of documents. In the absence, therefore, of a successful application for injunctive relief, I should have thought that the bundles for the forthcoming trial should include the documentation…In such circumstances, it is hard to understand how any claim to privilege could be sustained: ‘confidentiality is a precondition for privilege’ (Thanki, at paragraph 5.01).” (Birdseye v. Roythrone & Co [2015] EWHC 1003 (Ch), §46).
Document in the open (loss of privilege unless impropriety)
“HMRC produced two authorities, namely R v Tompkins and ITC Film Distributors and Others v Video Exchange Ltd & Others. The parties were agreed on the general legal principle that the general proposition is that once a document is in the possession of another party or is out in the open then the privilege is lost and if it is relevant it is admissible. However, [the taxpayer] argued that although ITC confirmed the decision in R V Tompkins it was stated that “…but that case proceeded on the footing that the document in question they had came into the possession of the prosecution fortuitously. The relevance of possible impropriety was not discussed”. Mr Bridge’s view was that since the document had been found following the issue of a search warrant under Section 8 of the Police and Criminal Evidence Act, clearly the document should have been “blue bagged”. That had not happened and therefore there had been a breakdown in the proper management of handling of a document which on its face was properly privileged and should have been the subject of proper treatment as a privileged document. We have absolutely no evidence as to precisely what had happened after this document, together with the million or so other documents seized in Operation Apparel, was released to HMRC. We decided that there was no impropriety, that the document had been released into the public domain and that it should be admitted in evidence. Mr Bridge requested a full reasoned decision in regard to propriety. At that juncture Mr McGuiness said that he did not insist on the documentation being led in evidence and withdrew. There is therefore no requirement for a reasoned decision since it has no import in this appeal.” (Aircall International Ltd v. HMRC [2016] UKFTT 406 (TC), §649).
No waiver by disclosing to third party on condition of confidentiality
“The authorities demonstrate that if the person entitled to assert the privilege provides the documents concerned to a third party on terms that they be kept confidential then the third party will be obliged to maintain privilege.” (Garvin Trustees Ltd v. The Pensions Regulator [2014] UKUT B8, §26, Judge Herrington)
Query whether this applies to litigation privilege
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See Thanki: The Law of Privilege §3.34
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Matters that are not usually confidential
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- Identity of the client and existence of retainer
"[21] It follows, in my judgment, that the identity of the person contacting the solicitor is not information subject to legal professional privilege and the telephone numbers of the brothers, equally, are not covered by this protection; neither are the dates when one or either of those men phoned the office. Moreover, the record of appointments in the office diary and attendance notes, insofar as they merely record who was speaking to the solicitor and the number they were calling from, fall within the same category. Other details contained within the attendance notes may well be covered by legal professional privilege depending on what, if anything was discussed." (R (oao Miller Gardner Solicitors) v. Minshull Street Crown Court [2002] EWHC 3077 (Admin), Rose LJ)
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No public interest override to privilege
"[4] Mr Jaffey QC for the Claimants acknowledges that LPP and legal advice privilege is an absolute privilege: where it exists it is not subject to any balancing exercise and cannot be overturned by reference to the public interest. Properly too, Mr Jaffey argues that privilege arises for Government parties, in relation to advice from in-house as well as independent lawyers. None of those points are in contention. The issue is the effect of the waiver." (Belhaj v. DPP [2018] EWHC 513 (Admin), Irwin LJ and Green J)​
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Privilege arises equally for government parties
"[4] Mr Jaffey QC for the Claimants acknowledges that LPP and legal advice privilege is an absolute privilege: where it exists it is not subject to any balancing exercise and cannot be overturned by reference to the public interest. Properly too, Mr Jaffey argues that privilege arises for Government parties, in relation to advice from in-house as well as independent lawyers. None of those points are in contention. The issue is the effect of the waiver." (Belhaj v. DPP [2018] EWHC 513 (Admin), Irwin LJ and Green J)
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WAIVER
Summary of five ways in which privilege may be lost
"[14] The term 'waiver of privilege' is an imprecise one, which is capable of referring to at least five legally distinct ways in which a right to assert privilege may be lost:
i) What might be called a 'true' waiver occurs if one party either expressly consents to the use of privileged material by another party or chooses to disclose the information to the other party in circumstances which imply consent to its use. Such a waiver may be either general or limited in scope.
ii) Where a party waives privilege in the above sense by deliberately deploying material in court proceedings, the party also loses the right to assert privilege in relation to other material relating to the same subject matter: see e.g. Great Atlantic Insurance Co. v Home Insurance Co. [1981] 1 WLR 529. The underlying principle is one of fairness to prevent 'cherry picking': see e.g. Brennan v Sunderland City Council [2009] ICR 479, 483-4 at [16].
iii) Similarly, a party who by suing its legal advisor puts their confidential relationship in issue cannot claim privilege in relation to information relevant to the determination of that issue. Again the governing principle is one of fairness: see e.g. Paragon Finance v Freshfields [1999] 1 WLR 1183.
iv) Because privilege only protects information which is confidential, if the information concerned ceases to be confidential, privilege cannot be claimed. Where a party does an act which has the effect of making information public, this has sometimes been described as a waiver of privilege (see e.g. Goldstone v Williams (1899) 1 Ch 47), but it is more accurate to say that privilege cannot be claimed because confidentially has been lost.
v) Where a party comes into possession of privileged material by any means, and even if without the knowledge or consent of the other party, the receiving party is free to use such material subject to the equitable jurisdiction of the court to restrain a breach of confidence.
[15] It is the last two of these principles which are relied on by the claimant in this case." (Mohammed v. MoD [2013] EWHC 4478 (QB), Leggatt J)
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(1a) Waiver by sending to the other party
“It follows, in my view, that it was open to Mr Doubleday to waive privilege in the Roythornes files on his own and that he in fact did so when his solicitors sent the file to Mossop & Bowser in May 2013.” (Birdseye v. Roythrone & Co [2015] EWHC 1003 (Ch), §38).
- Court has power to restrain following inadvertent inspection of privileged document
"[24] That requirement to seek permission arises, where inadvertent disclosure of privileged material has occurred, pursuant to CPR r.31.20. This provides:
"Where a party inadvertently allows a privileged document to be inspected, the party who has inspected the document may use it or its contents only with the permission of the court."
[25] In Al Fayed v Commissioner of Police of the Metropolis (No 1) [2002] EWCA Civ 780, the Court of Appeal considered that the principles which govern the operation of this rule are the same as apply at common law where an injunction is sought to prevent the use of inadvertently disclosed confidential information. The Court of Appeal summarised the relevant principles (at paragraph 16 of the judgment) as follows:
"i) A party giving inspection of documents must decide before doing so what privileged documents he wishes to allow the other party to see and what he does not.
ii) Although the privilege is that of the client and not the solicitor, a party clothes his solicitor with ostensible authority (if not implied or express authority) to waive privilege in respect of relevant documents.
iii) A solicitor considering documents made available by the other party to litigation owes no duty of care to that party and is in general entitled to assume that any privilege which might otherwise have been claimed for such documents has been waived.
iv) In these circumstances, where a party has given inspection of documents, including privileged documents which he has allowed the other party to inspect by mistake, it will in general be too late for him to claim privilege in order to attempt to correct the mistake by obtaining injunctive relief.
v) However, the court has jurisdiction to intervene to prevent the use of documents made available for inspection by mistake where justice requires, as for example in the case of inspection procured by fraud.
vi) In the absence of fraud, all will depend upon the circumstances, but the court may grant an injunction if the documents have been made available for inspection as a result of an obvious mistake.
vii) A mistake is likely to be held to be obvious and an injunction granted where the documents are received by a solicitor and:
a) the solicitor appreciates that a mistake has been made before making some use of the documents; or
b) it would be obvious to a reasonable solicitor in his position that a mistake has been made;
and, in either case, there are no other circumstances which would make it unjust or inequitable to grant relief.
viii) Where a solicitor gives detailed consideration to the question whether the documents have been made available for inspection by mistake and honestly concludes that they have not, that fact will be a relevant (and in many cases an important) pointer to the conclusion that it would not be obvious to the reasonable solicitor that a mistake had been made, but is not conclusive; the decision remains a matter for the court.
ix) In both the cases identified in vii) a) and b) above there are many circumstances in which it may nevertheless be held to be inequitable or unjust to grant relief, but all will depend upon the particular circumstances.
x) Since the court is exercising an equitable jurisdiction, there are no rigid rules." (Mohammed v. MoD [2013] EWHC 4478 (QB), Leggatt J)
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- Must be obvious mistake
"[29] As mentioned earlier, it is not in dispute that the information which the defendant now wishes to redact is privileged. Nor is it in dispute that the disclosure of that information both in the Maya Evans proceedings and in this action – by allowing the present claimant's solicitors to inspect the documents disclosed in the Maya Evans proceedings – was inadvertent. In these circumstances, applying the principles stated in Al Fayed, it is too late for the defendant to claim privilege unless the documents were made available to the claimant's solicitors for inspection as a result of an obvious mistake." (Mohammed v. MoD [2013] EWHC 4478 (QB), Leggatt J)
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- Would the mistake have been obvious to a reasonable solicitor who received the documents?
"[33] I must therefore next consider whether it would have been obvious to a reasonable solicitor who inspected the documents that a mistake had been made. The formulation of the fifth principle stated by the Court of Appeal in Al Fayed (quoted above) implies that the court should assume for this purpose that detailed consideration is given by the solicitor to the question whether the documents have been made available for inspection by mistake. That assumption seems to me, with respect, to be appropriate: it would not generally be equitable to allow a party to benefit from a mistake because his solicitors have not given detailed consideration from which the mistake would have been obvious. Such consideration should clearly take account of background information within the solicitor's knowledge. However, since the test is one of obviousness, it is also clear that where such consideration gives rise to mere suspicion or doubt about the matter the reasonable solicitor is not obliged to make any further enquiries of the other party before making use of the documents." (Mohammed v. MoD [2013] EWHC 4478 (QB), Leggatt J)
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(1b) Waiver by relying on the substance of privileged advice
“[The third defendant], [the claimant] said, did not just indicate that he had received advice from Roythornes, but set out the substance of the advice, relied on it by way of defence to the allegations made against him and offered to provide the documents in question…In short, it seems to me that privilege would have been waived by [the third defendant] if it had not already been waived by [the fourth defendant].” (Birdseye v. Roythrone & Co [2015] EWHC 1003 (Ch), §40…44).
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- Fundamental question is fairness/prevention of cherry picking
"[36] The classic statement of principle for applications of this sort, to which both sides referred me, appears in the judgment of Mustill J in Nea Karteria Maritime Co Ltd v Atlantic & Great Lakes Steamship Corp (No.2) [1981] Com LR 138 at 139:
"… where a party is deploying in court material which would otherwise be privileged the opposite party and the court must have an opportunity of satisfying themselves what the party has chosen to release from that privilege represents the whole of the material relevant to the issue in question. To allow an individual item to be plucked out of context would be to risk injustice through its real weight or meaning being misunderstood."" (Thomas v. Metro Bank Plc [2022] EWHC 2112 (Ch), Deputy Judge Parfitt)
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“In our view the fundamental question is whether, in the light of what has been disclosed and the context in which disclosure has occurred, it would be unfair to allow the party making disclosure not to reveal the whole of the relevant information because it would risk the court and the other party only having a partial and potentially misleading understanding of the material. The court must not allow cherry picking, but the question is when has a cherry been relevantly placed before the court?” (Brennan v Sunderland City Council [2009] ICR 479, §63, Elias J)
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- Waiver not easily established
“Having said that, we do accept that the authorities hold fast to the principle that legal advice privilege is an extremely important protection and that waiver is not easily established. In that context something more than the effect of the advice must be disclosed before any question of waiver can arise.” (Brennan v Sunderland City Council [2009] ICR 479, §66, Elias J)
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- Waiver not avoided by summarising advice but saying privilege is not waived
"[35] As a preliminary point on the waiver issue, paragraph 67 of Mr Thomas's witness statement states that the Trustees "do not waive privilege" in respect of the Russian law advice summarised in the witness statement. As Mr McCombe pointed out, a party cannot avoid waiving privilege by making such a statement. Whether there is a waiver or not is determined by looking at the material itself, not what the party says about it or the intention behind its deployment." (Thomas v. Metro Bank Plc [2022] EWHC 2112 (Ch), Deputy Judge Parfitt)
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- Must disclose content rather than effect of advice
“To say no more than that "I am acting on the advice of my solicitors and counsel" will not ordinarily justify further disclosure of the advice or of the circumstances in which any new witness statement came to be drafted.” (D (A Child) [2011] EWCA Civ 684, §24, Ward LJ).
“Typically, as we have seen, the cases attempt to determine the question whether waiver has occurred by focusing on two related matters. The first is the nature of what has been revealed; is it the substance, the gist, content or merely the effect of the advice?” (Brennan v Sunderland City Council [2009] ICR 479, §64, Elias J)
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- But caution about distinguishing content and effect
We would not, therefore, adopt in quite such stark terms the contents/effects distinction which Mr White submits represents the law. Plainly the fuller the information provided about the legal advice, the greater the risk that waiver will have occurred. But we do not think that the application of the waiver principle can be made to depend on a labelling exercise, particularly where the categories are so imprecise. The concepts shade into each other, and do not have the precision required to justify their employment as rigid tests for defining the scope of waiver.” (Brennan v Sunderland City Council [2009] ICR 479, §65, Elias J)
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- Must rely on disclosed content
“In our view the authorities demonstrate that reliance is necessary and there is currently no indication that the Council has any intention of relying on the advice.” (Brennan v Sunderland City Council [2009] ICR 479, §69, Elias J)
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- Including relying on it at interlocutory hearing
"[42] The Trustees made a further point on the timing of the deployment of the material, noting that the authorities on waiver of privilege referred to by the two sides in their authorities bundles were all trials, rather than interlocutory applications. This observation may have been correct, but it was a coincidence. In reply, Mr McCombe referred to passages in Passmore which were in his authorities bundle and which included discussion of cases such as Berezovsky v Abramovich [2011] EWHC 1143 (Comm) in which deployment in interlocutory applications was held to amount to a waiver of privilege. Other interlocutory cases to the same effect were referred to in the same passage including Re Derby & Co Ltd v Weldon (No. 10) [1991] 1 WLR 660 and the Dunlop Slazenger case cited above." (Thomas v. Metro Bank Plc [2022] EWHC 2112 (Ch), Deputy Judge Parfitt)
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- Summarising advice in a witness statement is relying on it, even before hearing
"[39] As to deployment in court, the Trustees sought to argue that although Mr Thomas's witness statement referred to privileged material, this material was not being deployed in court – or at least not yet. It was argued that it will only be deployed at the hearing of the s. 366 Application itself. I disagree. It would be manifestly unjust and risk undermining the proper management of litigation if the party on the receiving end of an application supported by privileged material had to wait until the substantive hearing before being able to obtain sight of the remainder of the privileged material concerning the issue in question. To have to wait until that point would invite an application for an adjournment at the last minute, wasting court time and costs for both sides. It seems to me that the moment at which a party is taken to have deployed material in court must be earlier than that, at least if it is clear that the party will ultimately be relying on the material. As Mr McCombe said, why put off dealing with the issue. I agree. This was the view taken by Auld LJ in the Divisional Court in R v Secretary of State for Transport, Ex p. Factortame [1997] EWHC Admin 445, in which he stated as follows:
"Much will depend, of course, on the indication given by the party waiving privilege before trial whether he intends to rely upon the privileged material at trial and, if so, for what purpose. If he does intend to put it in evidence, there is an obvious advantage in both parties knowing where they stand before trial. It enables each of them to determine whether and how to proceed with the litigation and to avoid costly adjournments for further discovery and consequential work which otherwise would occur if the point had to be determined at trial."" (Thomas v. Metro Bank Plc [2022] EWHC 2112 (Ch), Deputy Judge Parfitt)
- Exhibiting to witness statement without referring to it not reliance
“The disputed material was put before the court as an exhibit to a lengthy witness statement. The legal advice has not been specifically referred to in the pleadings nor in the witness statements themselves and in our view the mere reference to the advice - even to the content of it - was not in the circumstances sufficient to constitute a waiver of privilege. The council is not seeking to rely upon the advice to justify the reason why it decided to implement pay protection for a period of four years…We should emphasise that the situation would change if the material were subsequently to be relied upon by the council.” (Brennan v Sunderland City Council [2009] ICR 479, §§69…70, Elias J)
- No need for the person to understand that privilege was being waived
“Once it has been conceded that in the circumstances of this case there has been a waiver, then it matters not whether it was a waiver by the solicitor on behalf of the client or in addition to the waiver by the client herself. Here the waiver was made by the client for it is the words of her witness statement which lose her the protection of professional privilege. The effect of those words, objectively construed, prevails notwithstanding the fact that they were drafted by the solicitor and not withstanding the fact, moreover, that neither she nor her advisers appreciated the consequence those words would have.” (D (A Child) [2011] EWCA Civ 684, §18, Ward LJ).
“I do not accept that privilege can be waived only where the person entitled to it is aware of his rights. Thanki, "The Law of Privilege", 2nd ed., is correct, I think, that the "basic position in England is that once the substance of privileged material is divulged to one's opponent, even by accident and even where there is no implication of an intention to waive, privilege is prima facie lost" (paragraph 5.02)…In the Great Atlantic case, privilege in the whole of a memorandum was held to have been waived as a result of the plaintiffs' counsel reading out part of it during his opening, notwithstanding that, as Templeman LJ said at 537, "[t]he plaintiffs and all their legal advisers never intended to waive any privilege." (Birdseye v. Roythrone & Co [2015] EWHC 1003 (Ch), §42)
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- Waiver where party alleged compromise agreement void due to lack of advice from solicitor
“ Peter-Clark J determined [in National Centre for Young People with Epilepsy v Mrs S Boatang UTEAT/0440/10/CEA that Mrs Boatang had waived privilege because her case was reliant on the alleged failure on the part of the solicitor in order to resile from the compromise agreement and pursue her claim. The nature of the advice given (to sign the agreement) and reliance on its inadequacy gave rise to a conclusion that there had been waiver. Applying the fairness principle from Brennan it was determined that it would be “manifestly unfair” for the solicitor not to be given the opportunity (by being released from the bound of privilege) from putting his position in order that the Tribunal could then determine the efficacy of the compromise agreement and thereby the strike out application.” (D Cash and Carry Ltd v. HMRC [2017] UKFTT 732 (TC), §48)
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- Waiver by revealing details of conversations that led to a change of story
“Mr Hayden now accepts that the Mother did waive that privilege because her witness statement could not be said to make only "glancing reference" to the conversations with counsel and solicitors. Mr Hayden was absolutely right to make that concession. The Mother had revealed not merely that she had been given advice but also the nature of that advice. Thus she revealed how the questioning "made it easy to tell them what had happened and I demonstrated what I saw on a doll". The solicitor asked her "lots of questions to clarify the order of events". It was "with the support of my legal team and their assurances that there are things that can be done to protect me" that she agreed to "tell the court everything I know". She has undoubtedly waived the privilege that would ordinarily leave the advice she was given and the manner in which her statement was extracted from her sacrosanct and inviolate.” (D (A Child) [2011] EWCA Civ 684, §17, Ward LJ – no waiver if simply say acting on advice - §24)
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- Relying on lack of advice to justify late appeal
“Mr Dhami by his witness statement and the Appellant in its amended grounds supporting it’s out of time appeal have not simply referenced the interaction with Altion they have described the nature of the discussion and the absence of advice. Their whole case for an out of time appeal is predicated on that lack of advice so as to excuse their failure to act within the statutory time limits…Given the contradictory evidence as between the initial grounds and first witness statement of Mr Dhami and the documents served on 22 August 2017 the integrity of the basis of the application must fall under scrutiny. For the application to be fairly and justly considered the role played by Altion and establishing the true position for the delay needs to be established and that will be achieved only through information and documentation held by Altion. As was the case in both Boatang and D the question of fairness requires that HMRC be entitled to cross examine Mr Dhami as to the veracity of the case he presents on behalf of the Appellant for why the appeal was not made in time. To do so HMRC need access to evidence of the communications between Mr Dhami and Altion.” (D Cash and Carry Ltd v. HMRC [2017] UKFTT 732 (TC), §§53…54, Judge Amanda Brown)
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(2) Collateral waiver of material relating to the same transaction in respect of which voluntary waiver made
"[113] The starting point is to ascertain "the issue in relation to which the [voluntarily disclosed material] has been deployed", known as the "transaction test" (General Accident Fire and Life Assurance Corporation Limited v Tanter [1984] 1 WLR 100 at 113D per Hobhouse J), waiver being limited to documents relating to that "transaction" subject to the overriding requirement for fairness. The "transaction" is not the same as the subject matter of the disclosed document or communication, and waiver does not apply to all documents which could be described as "relevant" to the issue, in the usual, Peruvian Guano sense of the term as used in disclosure (Compagnie Financière et Commerciale du Pacifique v Peruvian Guano Company (1882) 11 QBD 35).
[114] In Fulham Leisure Holdings Limited v Nicholson Graham & Jones [2006] EWHC 158 (Ch); [2006] 2 All ER 599 at [18], having reviewed the relevant authorities, Mann J described the approach thus:
"18. What those citations show is that it is necessary to bear in mind two concepts. First of all, there is the actual transaction or act in respect of which disclosure is made. In order to identify the transaction, one has to look first at what it is in essence that the waiving party is seeking to disclose. It may be apparent from that alone that what is to be disclosed is obviously a single and complete 'transaction' – for example, the advice given by a lawyer on a given occasion…. [O]ne is in my view entitled to look to see the purpose for which the material is disclosed, or the point in the action to which it is said to go…. Mr Croxford [Counsel for the claimant, which sought to rely on LAP] submitted that the purpose of the disclosure played no part in a determination of how far the waiver went. I do not agree with that; in some cases it may provide a realistic, objectively determinable definition of the 'transaction' in question. Once the transaction has been identified, then those cases show that the whole of the material relevant to that transaction must be disclosed. In my view it is not open to a waiving party to say that the transaction is simply what that party has chosen to disclose (again contrary to the substance of a submission made by Mr Croxford). The court will determine objectively what the real transaction is so that the scope of the waiver can be determined. If only part of the material involved in that transaction has been disclosed then further disclosure will be ordered and it can no longer be resisted on the basis of privilege.
19. Once the transaction has been identified and proper disclosure made of that, then the additional principles of fairness may come into play if it is apparent from the disclosure that has been made that it is in fact part of some bigger picture (not necessarily part of some bigger 'transaction') and fairness, and the need not to mislead, requires further disclosure. The application of this principle will be very fact sensitive, and will therefore vary very much from case to case…."
The purpose of the voluntary disclosure, which has prompted the contention that privilege in other material has been collaterally waived, is therefore an important consideration in the assessment of what constitutes the relevant "transaction" (see also Dore v Leicestershire County Council [2010] EWHC 34 (Ch) at [18]-[19] also per Mann J)." (Civil Aviation Authority v. Jet2.com Limited [2020] EWCA Civ 35)
"[44] The relevant authorities for ascertaining the "whole of the material relevant to the issue in question" were considered by Mann J in Fulham Leisure Holdings Ltd v Nicholson Graham & Jones [2006] PNLR 23, and the process the court should follow was distilled as follows at [11]:
"Based on the authorities which I am about to refer to, it seems to me that the relevant process should be as follows:
i) One should first identify the 'transaction' in respect of which the disclosure has been made.
ii) That transaction may be identifiable simply from the nature of the disclosure made—for example, advice given by counsel on a single occasion.
iii) However, it may be apparent from that material, or from other available material, that the transaction is wider than that which is immediately apparent. If it does, then the whole of the wider transaction must be disclosed.
iv) When that has been done, further disclosure will be necessary if that is necessary in order to avoid unfairness or misunderstanding of what has been disclosed.
That chain is not articulated in terms in the authorities to which I am about to refer, but it seems to me that it is apparent from it."" (Thomas v. Metro Bank Plc [2022] EWHC 2112 (Ch), Deputy Judge Parfitt)
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- Collateral waiver only goes as far as necessary to prevent injustice of potential cherry picking
"[43] Turning to the "whole of the material relevant to the issue in question", the reason a party relying on privileged material must disclose the whole of the material is fairness, or (putting it the other way) avoiding the risk of injustice. A party should not be free to cherry pick, potentially giving a misleading impression of the privileged material as a whole, while being immune from any further disclosure on grounds of privilege. On the other hand, however, the importance of legal professional privilege to the due administration of justice means that a derogation from it to avoid injustice must go only as far as is necessary to prevent that injustice. That waiver of privilege is to be confined in this way can be seen from the earliest cases to which I was referred, such as Lyell v Kennedy (No. 3) (1884) 27 ChD 1 in which Cotton LJ (at 24) rejected a submission that a party who waived privilege at all necessarily waived privilege altogether." (Thomas v. Metro Bank Plc [2022] EWHC 2112 (Ch), Deputy Judge Parfitt)
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- No waiver of whole document if it contains to advice on other issues
"[46] The "transaction" in respect of which the Trustees have made disclosure is the taking of advice on the Russian law of matrimonial property as it relates to monies held in bank accounts in the name of one of the spouses. That is the only Russian law issue on which the Trustees have taken advice which is relevant to the s. 366 Application. The Trustees have no doubt taken other Russian law advice. Perhaps that advice forms part of a single document from which the Extract was taken. But that other advice has nothing to do with the s. 366 application as advanced by the Trustees. They have not waived privilege in relation to that advice, and can continue to assert privilege in relation to it. This is a situation in which, in accordance with the principle of severance described by Templeman LJ in Great Atlantic Insurance v Home Insurance [1981] 1 WLR 529 at 536, it is possible to sever the advice over which privilege has been waived from any other advice, which remains privileged. There will be nothing "unfair or misleading" about that, in the phrase used by Templeman LJ at 538-9 to which Mr Ramel drew my attention; any other advice has nothing to do with the s. 366 Application. In this way, there is limited danger of an order for disclosure on the Privilege Application tipping anyone off in such a way as to frustrate the Trustees' conduct of the bankruptcy.
[47] Mr McCombe invited me to go further and order the disclosure of at least the entirety of the advice from which the Extract was taken, and any other advice on the same subject matter on different occasions. This, in my view, is too broad-brush an approach. The power to order disclosure of privileged material only arises to prevent injustice. Any order must match the injustice, and that means it must be constrained to the advice on the point which will be in issue. Mr McCombe's approach also risks jumping too far ahead in the step-by-step process outlined in Fulham Leisure." (Thomas v. Metro Bank Plc [2022] EWHC 2112 (Ch), Deputy Judge Parfitt)
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- No collateral wavier where document relied on for purpose other than showing legal advice
"[119]...In my view, the purpose and nature of the voluntary disclosure are crucial; and, in this case, I consider Morris J unfortunately failed properly to take these matters into account. As the judge accepted, the disclosure was not in respect of any legal advice; and so it could not be said that there was any risk of the email presenting a partial or selective disclosure of legal advice and thus there was no risk of unfairness that might have been caused by such partial disclosure. The purpose of the email was modest: it was intended to show that (in Mr Moriarty's words) the language used by Mr Haines in his email of 18 January 2018 was "not reflective of any part of the approach taken by the CAA"; or, perhaps more accurately, that not all of the executives at CAA shared the approach suggested by Mr Haines' earlier email. It cannot be right that such a modest voluntary disclosure could result in the collateral waiver (and thus the forced disclosure by the CAA) in respect of all the internal communications relating to the drafting of the 1 February 2018 letter, including those that expressly reveal legal advice from the CAA's lawyers; nor is that what the law (or fairness) requires." (Civil Aviation Authority v. Jet2.com Limited [2020] EWCA Civ 35)
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- Collateral waiver will extend to the instructions and whether any other parts of the document deal with the issue
"[48] One of the Trustees' answers to the Disclosure Application is that they have already disclosed the entirety of the advice relevant to this issue or transaction on a voluntary basis in the Extract. I am not persuaded that that is the case. What the Trustees have not disclosed is what instructions prompted the Extract, and whether any other parts of the Extract deal with the Russian law of matrimonial property as it relates to monies held in bank accounts in the name of one of the spouses. The Extract draws conclusions as to the application of Russian law to monies in Mrs Yurova's bank accounts. The reasoning behind those conclusions is going to be relevant on the s. 366 Application. Not only will the court wish to see such reasoning, but as a matter of basic procedural fairness Mrs Yurova should also see it so that she can challenge it if she wishes.
...
[51] In my judgment, this is an appropriate case for the Trustees to be ordered to disclose the following:
(1) Legal advice received in relation to the Russian law of matrimonial property as it relates to monies held in bank accounts in the name of one of the spouses, including in particular advice addressing the facts of the present case;
(2) Instructions which led to such advice being given, insofar as those instructions deal with these issues, with redactions to remove any other instructions; and
(3) Any communications between the advising lawyer and those giving instructions concerning the substance of the disclosable instructions or the disclosable advice, if separate from the advice or instructions themselves.
" (Thomas v. Metro Bank Plc [2022] EWHC 2112 (Ch), Deputy Judge Parfitt)
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- No waiver simply because it appears party not following legal advice
“The alleged inconsistency is the fact that the council is now in its submissions before the court departing from its legal advice. Even if that were…it would be no more than a 'jury point' in support of the claimants' case. It should not, in our judgment, influence the Tribunal's assessment of the merits of the GMF defence at all.” (Brennan v Sunderland City Council [2009] ICR 479, §72, Elias J)
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(3) Client suing lawyer (only communications between client and lawyer)
"In Banque Bruxelles Lambert SA v Simmons and Simmons (a firm) (unreported, 23 November 1995), a client sued its former solicitors claiming damages for negligence in relation to a particular transaction. Among the solicitors’ defences were allegations of contributory negligence on the part of the client. In support of its defences the solicitors sought disclosure of the files of the client’s in-house legal department relating to the disputed transaction insofar as those files had come into existence before legal proceedings against the solicitors had been contemplated. The client contended that those files were privileged, and that there had been no waiver of the privilege. Blackburne J upheld the client’s claim. He said (at page 40 of the transcript of his judgment):
“In my judgment the waiver applies only to communications between the client and the solicitor whom he is suing and not to privileged communications between the client and some other solicitor, and I do not consider that the decision in Lillicrap, properly understood, is intended to establish any wider principle. Mr Hart submitted that the touchstone is that the waiver extends, to take the words of Russell LJ, to “all matters .......relevant to the suit ......to enable justice to be done” or, to take the words of Farquharson LJ, “to documents and information ......relevant to the issue between the parties and which it would be unfair to exclude” so that it can extend to privileged communications between the client and another solicitor (unconnected with the defendant solicitor) bearing on the issue in the suit. If that were correct it is difficult to see why the waiver should not equally extend to privileged communications between a client and his solicitor where the client is suing someone who was not his solicitor and who owed no duty of confidence in relation to any communication passing between them.”
In our view the judge was right, both in his reading of Lillicrap and in his understanding of the relevant principle." (Paragron Finance Plc v. Freshfields [1999] EWCA Civ 955)
(4) Information becomes public (confidentiality lost)
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- Mere reference to a document in open court not sufficient to lose confidentiality
"[18] I accept that information does not necessarily enter the public domain just because a document containing it is mentioned in open court, or even because the information itself is disclosed in open court. However, there are, as I see it, two routes by which in such circumstances the confidentiality of information may be lost." (Mohammed v. MoD [2013] EWHC 4478 (QB), Leggatt J)
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- Question of fact and degree with sufficient publicity given to the information
"[19] First, sufficient publicity may be given to information disclosed in open court that it can no longer be regarded as confidential. This is a question of fact and degree. Frequently and no doubt typically, however, passing references to documents in open court do not attract sufficient publicity to cause them to lose their confidentiality in this way." (Mohammed v. MoD [2013] EWHC 4478 (QB), Leggatt J)
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- General public right to access documents referred to in court can be restricted by Court on application by privilege holder
"[20] Second, there is a general public right of access, based on the principle of open justice, to documents read or referred to in court: see R (Guardian News & Media Ltd) v Westminster Magistrates Court [2013] QB 618. For this reason, I take the default position to be that reference to a document containing confidential information in open court will put the information into the public domain and deprive it of its confidential character. This is, however, subject to the power of the court to prevent or restrict the further publication or use of the information, and thereby preserve its confidentiality, if there is good reason to do so.
[21] The subsequent use of documents disclosed in litigation is now governed by CPR r.31.22...
[22] Usually, an application for an order under CPR r.31.22(2) is made in the proceedings in which the document has been disclosed. There is nothing in the language of the rule, however, which so confines it; and I see no reason in principle why such an application should not be made in subsequent proceedings to restrict or prohibit the use of a document by a party who has acquired the document from a party to whom it was disclosed in the earlier proceedings. The fact that no application is made until much later may be a very relevant factor in deciding whether to make an order. However, it should not preclude the making of an order if it is still practicable to preserve the confidentiality of information contained in the document and the balance of competing interests is demonstrably in favour of doing so.
[23] In my view, therefore, the fact that two of the documents now in issue were referred to in open court at the hearing of the Maya Evans case does not of itself prevent the defendant from claiming privilege over information disclosed in those documents. Its effect is to place the onus on the defendant to apply for and justify the making of an order under CPR r.31.2(2), whereas for the other documents in issue it is the claimant who must seek the permission of the court."
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- Obvious mistake required (assessed objectively)
"[30] It seems to me that such an obvious mistake would similarly need to be the starting point for an attempt to restrain the use of the two documents referred to in open court in the earlier proceedings. The grounds required to justify restricting the use of a privileged document which has been inadvertently disclosed must in principle be at least as strong, if not stronger, where the permission of the court is not needed to use the document as are required where such permission is needed under CPR r.31.20. CPR r.31.20 does not apply to the documents referred to in open court as the solicitors for Maya Evans were entitled to pass those documents to the present claimant's solicitors, who are likewise entitled to use them irrespective of the defendant's agreement, unless and until an order is made under CPR r.31.22(2).
[31] In each case, even if an obvious mistake is shown, the question will ultimately be whether it is just and equitable to prevent use of the material in these proceedings.
...
[40] It would be all the less obvious that the disclosure was inadvertent given the reference made to document H1 in open court by the defendant's counsel at the hearing of the Maya Evans case. The purpose of the reference was to show that active consideration had been given to obtaining international agreement to an extension of the period for which the UK could detain individuals and the improbability that any such extension could be agreed. It is evident from the page reference and what was said by the defendant's counsel that the part of the document to which the court's attention was being directed was paragraph 11, which set out three possible solutions to the problem of detention, and paragraph 12, which pointed out difficulties which each of these lines of action faced. Paragraph 12 expressly referred to "MOD Legal Advice". In my view, it would reasonably be assumed that the decision to refer to this advice was deliberate. I consider that the same applies to other references to legal advice in the same document which formed part of the background to the issues to which the defendant specifically drew attention in argument." (Mohammed v. MoD [2013] EWHC 4478 (QB), Leggatt J)
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(5) Receiving party comes into possession of material by any means
"[14] The term 'waiver of privilege' is an imprecise one, which is capable of referring to at least five legally distinct ways in which a right to assert privilege may be lost:
...
v) Where a party comes into possession of privileged material by any means, and even if without the knowledge or consent of the other party, the receiving party is free to use such material subject to the equitable jurisdiction of the court to restrain a breach of confidence." (Mohammed v. MoD [2013] EWHC 4478 (QB), Leggatt J)
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Waiver and joint privilege
- Jointly obtained legal advice requires joint waiver
“The general rule is of course that, where solicitors have been retained by clients jointly, a single client cannot waive privilege unilaterally.” (Birdseye v. Roythrone & Co [2015] EWHC 1003 (Ch), §28)
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- Trustees waiving privilege (must act together)
“The law relating to executors thus differs in this respect from that relating to trustees, who have to act together. It is not even possible for a majority of (non-charitable) trustees to bind a minority…”(Birdseye v. Roythrone & Co [2015] EWHC 1003 (Ch), §32)
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- Executors waiving privilege (act of one binds all if intended to do so irrespective of concurrence)
“When Calthrops sent Mossop & Bowser the file, they were clearly acting for Mr Doubleday [one executor], and they did not claim that Mr Pola [the other executor] had assented to disclosure. That being so, there is, I think, no reason why the general rule that “the act of one joint representative is regarded as the act of all and is binding” should not operate.” (Birdseye v. Roythrone & Co [2015] EWHC 1003 (Ch), §37).
“The son [one personal representative] did not purport to bind the estate of the deceased without the concurrence of the widow [the other personal representative]. He purported to bind the state for himself, as one administrator, and as the authorised agent of the widow as his co-administrator. He bound himself as one of two administrators and he warranted that he had authority to bind the other administrator, the widow. He did not bind himself to sell without the concurrence of the widow. It was really the reverse. He bound the estate of the deceased only on the assumption, which he warranted to be correct, that he had authority to sign as agent for the widow. That assumption having been falsified, there is no contract to be enforced in relation to the … property. All that may be sued upon is the warranty of authority given by the son.” (Fountain Forestry Ltd v. Edwards [1975] Ch 1, at 15)
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- Jointly obtained legal advice not privilege as between clients
“Parties who grant a joint retainer to solicitors of course retain no confidence as against one another: if they subsequently fall out and sue one another, they cannot claim privilege. But against all the rest of the world, they can maintain a claim to privilege for documents otherwise within the ambit of legal professional privilege; and because their privilege is a joint one, it can only be waived jointly, and not by one party alone.” (Hellenic Mutual War Risks Association (Bermuda) Ltd v. Harrison [1997] 1 Lloyd’s Rep 160 at 165)
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Trustees and beneficiaries
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- Legal advice to trustees is privileged vis-à-vis beneficiaries if taken to defend a claim against beneficiaries but not if taken in the course of administering the trust
“It is well established that a trustee cannot always assert privilege against a beneficiary of the trust. Thus, in Talbot v. Marshfield (1865) 2 Dr & Sm 549, while beneficiaries were denied access to advice that the trustees had received on how to defend a claim, they were held to be entitled to see advice that the trustees had taken on the exercise of a power.” (Birdseye v. Roythrone & Co [2015] EWHC 1003 (Ch), §19)
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- Privilege can be maintained against a beneficiary with no more than an arguable claim
“The authorities indicate, however, that privilege can be maintained against a person who has no more than an arguable claim to be a beneficiary.” (Birdseye v. Roythrone & Co [2015] EWHC 1003 (Ch), §21)
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Executors and legatees
- Treated the same as trustees and beneficiaries
“To my mind, however, it must remain the case that a person must, at least normally, establish as a minimum a prima facie case that he is a beneficiary before there can be any question of the Court requiring a trustee or executor to disclose documents which would be protected by privilege if the applicant were not a beneficiary.” (Birdseye v. Roythrone & Co [2015] EWHC 1003 (Ch), §24 – simply being named in the will insufficient)
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Procedure where privileged waived
- Redact material that is not relevant
“The issue between the parties in the present application is not whether there has been a waiver of privilege, which there clearly has been, but whether what has been released represents the whole of the material relevant to the issue in question, namely the issue in relation to which it has been disclosed. In particular whether there is a risk of injustice through the real weight or meaning of what has been disclosed being misunderstood…The instructions to counsel are clearly on the face of what has been disclosed relevant to technical aspects of the scheme, rather than the mechanism of assessment. There is simply nothing to suggest that they might contain material relevant to the assessment procedure.” (Burnikell v. HMRC [2018] UKFTT 140 (TC), §§41…45, Judge Cannan)
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- First order production of documents
“The Tribunal is not prepared, at this stage to require a witness summons for Ms Hudson. To date, as a consequence of the assertion that privilege had not been waived, Ms Hudson has not been in a position to provide any information and documentation…However, at this stage the Tribunal considers the correct course of action is to issue an order requiring Altion to provide information and documentation as particularised in the annex to this judgment.” (D Cash and Carry Ltd v. HMRC [2017] UKFTT 732 (TC), §57, Judge Amanda Brown)
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- Client given opportunity to see documents before disclosure to suggest redactions
“In view of the risk that documents containing evidence of communication between Altion and the Appellant may contain material not pertinent to the question of whether and if so what advice was given to the Appellant in connection with the need to appeal and the time limit for doing so the Tribunal has determined that to the extent that Altion consider redaction appropriate the suggested redactions will be provided for review and determination by the Tribunal. This protects the Appellant and should assuage the concerns of HMRC.” (D Cash and Carry Ltd v. HMRC [2017] UKFTT 732 (TC), §60, Judge Amanda Brown)
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- Then consider witness summons
“It may be the case that once such information and documentation has been provided neither side require the attendance of Ms Hudson at the hearing of the out of time application. Equally it may not.” (D Cash and Carry Ltd v. HMRC [2017] UKFTT 732 (TC), §57, Judge Amanda Brown)
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Effect of waiver
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- May be limited to the proceedings in relation to which it took place (as long as they do not come into the public domain)
"[68]...It does not follow that privilege is waived generally because a privileged document has been disclosed for a limited purpose only: see British Coal Corporation v Dennis Rye Ltd (No 2) [1988] 1 WLR 1113: Bourns v Raychem Corporation [1999] 3 All ER 154. The question is not whether privilege has been waived, but whether it has been lost. It would be unfortunate if it were. It must often be in the interests of the administration of justice that a partial or limited waiver of privilege should be made by a party who would not contemplate anything which might cause privilege to be lost, and it would be most undesirable if the law could not accommodate it." (B v. Auckland District Law Society [2003] UKPC 38, Lord Millett)
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"[52] As the judge observed in paragraph 45 of his judgment, there is nothing in the authorities on limited waiver which indicates that the concept has a restricted application such that it cannot be applicable to solicitor-own client relations. On the contrary, as Lord Millett explained in B v Auckland District Law Society, supra, the concept of limited waiver is of general application, designed to ensure that the loss of LPP (given its fundamental importance) is limited to that which is necessary to protect other interests." (Dechert LLP v. Eurasian Natural Resources Corporation Limited [2016] EWCA Civ 375, Gloster, King, David Richards LJJJ)
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- Party to whom privileged information has been disclosed may be prevented from using them in different proceedings
"[66]...Privilege, the Society submitted, is merely a right to resist compulsory disclosure. Once disclosure has occurred, it is no longer a question of privilege. Ex hypothesi a right to resist disclosure cannot be invoked against the person to whom disclosure has already been made. If he is to be restrained from making use of the information, it must be on the ground that the information is confidential. But the equitable right to the protection of confidential information may be outweighed by a countervailing public interest in having the information made available. In the present case the Judge held that the public interest would have prevailed over the firm's rights to preserve confidentiality.
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[69] The Society argued that, once the documents were produced to Mr Ennor, they ceased to be privileged. Their Lordships consider that this is playing with words. It confuses the nature of the documents with the rights to which the arrangements with Mr Ennor gave rise. The documents are privileged because they were created for the purpose of giving or receiving legal advice. If they are not produced voluntarily, production cannot be compelled. If they are produced voluntarily, the right to withhold production no longer attaches to them. In that sense the privilege may be said to be lost. But they are the same documents, and it is not inappropriate to describe them as privileged. Their inherent characteristics are the same. The policy which protected them from unauthorised disclosure is the same. The cat is still a cat. It can be put back in the bag.
...
[71] ... A lawyer must be able to give his client an unqualified assurance, not only that what passes between them shall never be revealed without his consent in any circumstances, but that should he consent in future to disclosure for a limited purpose those limits will be respected: see Goddard v Nationwide Building Society [1987] 1 QB 670, per Nourse LJ at p 685." (B v. Auckland District Law Society [2003] UKPC 38, Lord Millett)
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STATUTORY OVERRIDE
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Express words or necessary implication required
[4] "It was established by R (Morgan Grenfell & Co Ltd) v Special Commissioner of Income Tax [2002] UKHL 21, [2003] 1 AC 563 ("Morgan Grenfell") that the provisions of section 20 could not be invoked to force anyone to produce documents to which LAP attached. Lord Hoffmann at paras 7 and 9 said that a statute could only remove such "a fundamental human right" if it "expressly stated" that it was doing so, or if the intention "appear[ed] by necessary implication", and, as Lord Hobhouse emphasised at para 45, "[a] necessary implication is a matter of express language and logic not interpretation". (R (oao Prudential Plc) v. Special Commissioner of Income Tax [2013] UKSC 1)
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"[7] Two of the principles relevant to construction are not in dispute. First, LPP is a fundamental human right long established in the common law. It is a necessary corollary of the right of any person to obtain skilled advice about the law. Such advice cannot be effectively obtained unless the client is able to put all the facts before the adviser without fear that they may afterwards be disclosed and used to his prejudice. The cases establishing this principle are collected in the speech of Lord Taylor of Gosforth CJ in R v Derby Magistrates Court, Ex p B [1996] AC 487. It has been held by the European Court of Human Rights to be part of the right of privacy guaranteed by article 8 of the Convention (Campbell v United Kingdom (1992) 15 EHRR 137; Foxley v United Kingdom (2000) 31 EHRR 637) and held by the European Court of Justice to be a part of Community law: A M & S Europe Ltd v Commission of the European Communities (Case 155/79) [1983] QB 878.
[8] Secondly, the courts will ordinarily construe general words in a statute, although literally capable of having some startling or unreasonable consequence, such as overriding fundamental human rights, as not having been intended to do so. An intention to override such rights must be expressly stated or appear by necessary implication. The speeches of Lord Steyn and myself in R v Secretary of State for the Home Department, Ex p Simms [2000] 2 AC 115 contain some discussion of this principle and its constitutional justification in the context of human rights. But the wider principle itself is hardly new. It can be traced back at least to Stradling v Morgan (1560) 1 Pl 199." (R (Morgan Grenfell & Co Ltd v. Special Commissioner of Income Tax [2002] UKHL 21)​
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- Check for HRA 1998 compatibility
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"[39] It is of course open to Parliament, if it considers that the revenue require such powers, to enact them in unambiguous terms. But there is also the Human Rights Act 1998 to be borne in mind. The appellants put forward an alternative submission that, if your Lordships agreed with the construction given to section 20(1) by the Court of Appeal, you should make a declaration that it was incompatible with the right to privacy under article 8 of the Convention for the Protection of Human Rights and Fundamental Freedoms (1953) (Cmd 8969). In the circumstances it is unnecessary for your Lordships to pronounce upon the point. It is however the case, as I have mentioned, that the European Court of Human Rights has said that LPP is a fundamental human right which can be invaded only in exceptional circumstances: see Foxley v United Kingdom (2001) 31 EHRR 25 p 647, para 44. Mr Brennan said that the public interest in the collection of the revenue could provide the necessary justification but I very much doubt whether this is right. Nor is it sufficient to say simply that the power is not used very often. That is no consolation to the person against whom it is used. If new legislation is passed, it will have to be seen whether it is limited to cases in which the interference with LPP can be shown to have a legitimate aim which is necessary in a democratic society." (R (Morgan Grenfell & Co Ltd v. Special Commissioner of Income Tax [2002] UKHL 21)
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