Legal privilege at the intersection between civil and criminal disputes – confidentiality considerations

Legal professional privilege (LPP) is a fundamental principle that protects confidential communications between a client and their legal advisor. Criminal and civil disputes as well as cross-border disputes raise multifarious potential privilege issues due to differing rules.

Consider a scenario where a company is simultaneously involved in a criminal investigation in the United Kingdom and a class action lawsuit in the United States. In the UK, the company might agree to a limited LPP waiver to cooperate with regulators or law enforcement agencies. While prudent in the UK, this limited waiver might not be recognised by US courts, potentially resulting in wavier of LPP in the US class action lawsuit. The result being that the company’s legal advice and case theory could be used against it. This example illustrates just one of the numerous challenges posed by cross-jurisdictional LPP issues.

As such, in an increasingly interconnected global legal landscape, it is vital to thoroughly assess the implications of LPP waiver in all potentially relevant fora (now or later), the extent to which in-house legal counsel are recognised for LPP purposes, and the considerations surrounding cross-party document disclosures.

Waiver of LPP

Waiver of LPP occurs when the privilege holder acts in a way that is inconsistent with the communication remaining confidential. In some cases, clients are keen to make use of the media as part of their litigation strategy, for example, and refer to the existence of legal advice in open correspondence or issue a media release stating they have received advice that they are likely to succeed in litigation. Touching on the existence of, but not revealing the nature of the advice, for example, by informing a third party that you have obtained legal advice that a party to a dispute has not breached any laws, will generally not result in privilege being abrogated, as you have alluded only to the fact that you have received legal advice, without disclosing (expressly or impliedly) the substance of the advice. On the other hand, in a regulatory investigation, the regulator may request the production of legally privileged materials. If these are produced, even pursuant to a limited waiver, the LPP could be treated in other jurisdictions as having been waived.

It is a well-established principle in the UK, based on public policy considerations, that LPP can be waived on a limited basis where the material is disclosed to the police or other authorities to assist with a criminal investigation or a prosecution (in the UK, limited waivers are more uniformly accepted, whereas in the US, the concept of selective waiver is not consistently recognised across all jurisdictions). As LPP is a client’s right, only the client or someone authorized by them is capable of waiving LPP. In some circumstances, law enforcement may request a waiver of LPP.

There is a risk of the material being used against the LPP holder, for example in a prosecution regarding a matter where limited waiver had been agreed, but the waiver was more extensive than intended. Waiver is judged objectively and therefore there is scope for the waiver to exceed the scope that was intended – for example, if a law enforcement authority wants to share with another, even an express term may not necessarily stop the court from permitting disclosure. This risk is further compounded by the fact that limited waivers accepted in one jurisdiction may not be recognised in other jurisdictions where the facts of the case are relevant. As illustrated in the aforementioned example, a limited waiver in the UK might not be honoured by US courts, leading to unintended consequences in related legal proceedings. Therefore, it is crucial to carefully consider the potential cross-jurisdictional implications of any waiver of LPP.

LPP for in-house lawyers

Communications with in-house lawyers in the UK and US are generally privileged, provided the legal adviser is consulted in a professional legal and not a business capacity. Difficulties can arise where the in-house counsel performs more than one function, for instance, communications pertaining to the provision of non-legal business advice by in-house lawyers will not be protected by LPP. In most civil law systems (aside from Spain, Turkey, Mexico, and Korea where they do extend protection of professional secrecy to in-house counsel), communications with in-house counsel are not privileged. It is, therefore, crucial that thought is given to the jurisdiction and role that in-house counsel is performing when sending confidential communications and who the client is in relation to the given instructions.

Cross-border document disclosure considerations

Most civil law systems do not require parties to disclose documents to the opposing party and so they do not have specific rules of privilege to protect documents from disclosure. Instead, most civil law systems have a doctrine of professional secrecy. As part of their ethical and professional duties, lawyers are obliged to keep secret all confidential information obtained. Under French law, professional secrecy is a fundamental duty imposed on lawyers both through the French Penal Code and applicable professional regulations. Protection primarily applies to documents in the possession of the lawyer. If the documents are in the client’s possession, they may not be automatically protected under professional secrecy. In cross-border cases with documents overseas, thought will have to be given as to whether to remove documents from the jurisdiction.

Conclusion

Forum differences in jurisprudence regarding waiver of LPP, the extent of LPP applicable to in-house legal counsel, and cross-border document disclosure practices result in a broad spectrum of considerations essential for managing LPP effectively on a global scale. Consequently, it is prudent to identify and consider all relevant jurisdictions and civil, criminal, and regulatory fora that are (or may in future become) relevant to each case. Considering facts and legal strategy holistically and in a coordinated manner from the outset is crucial for mitigating risks and ensuring comprehensive LPP protection is available across multiple jurisdictions and fora.

 

Natalie Todd, partner at Cooke Young and Keidan, Amanda Raad, partner at Ropes & Gray, and Mark Rainsford KC, 33 Chancery Lane