Legal professional privilege can keep in-house lawyers awake at night. In this article we take a look at the top tips to help in-house lawyers to sleep soundly.
Legal professional privilege (LPP) is a client claim for privilege over communications made for the dominant purpose of seeking or providing legal advice or lawyer communications for use in current or anticipated legal proceedings.
Significant challenges can arise around understanding and claiming LPP in the in-house context.
Acting in the lawyer’s capacity?
In-house lawyers frequently engage in both legal and non-legal (e.g. commercial) activities within the organisation and often find themselves, or their client, struggling to draw the line between acting as an independent legal advisor and a business advisor.
It is common for in-house lawyers to signpost in their communications that they are subject to LPP by labelling their emails ‘subject to legal professional privilege’ or similar. To raise awareness and reduce confusion, in-house lawyers and their internal stakeholders might benefit from similarly signposting that their communications made in a non-legal business advisor role are not subject to LPP.
Dominant Purpose?
While a communication does not have to be for the sole purpose of legal advice or proceedings, one of those purposes needs to be the dominant purpose. If it is not, the claim for privilege may be weak at best.
This is especially relevant in the in-house environment as communications can be made and documents can be prepared for multiple purposes, including legal, operational, commercial and financial purposes. Recent court decisions (particularly the recent Optus experience) have emphasised that clear and sufficient evidence will be needed to establish that the dominant purpose of the communication was for a legal purpose at the time they were made.
Waived Privilege?
To avoid the privilege being inadvertently waived, it is important to ensure that no action is taken that is inconsistent with the maintenance of the privilege. A disclosure of a significant part of the privileged communications can result in privilege being waived over the entire communications.
Every additional recipient may increase the risk of privilege being waived, as the communication moves further away from the original purpose of the communication, and those with a genuine need to know. To guard against legal advice going viral within the organisation, in-house lawyers should take time to help their internal stakeholders to understand the concept and importance of LPP.
Other top tips?
Other helpful hints to assist the organisation’s lawyers to act independently in their lawyer capacity and attract LPP include:
- Consider ensuring that in-house legal lawyers are only be supervised by and directly report to the general counsel
- Consider a policy to help to ensure in-house legal counsel are independent and not subject to the directions of other managers (non-lawyers) in the business
- Legal advice should ideally not be mixed with other advice or comments provided in relation to business strategy or commercial operations when in-house lawyers are acting in their legal role
- While it is necessary to keep stakeholders informed, limit recipients of legal advice communications to those who need to know
- Upskill internal stakeholders should avoid referring directly to the fact of legal advice and the contents or substance of the advice in resultant communications, as this may compromise the privilege and may constitute a waiver of it
- When sending legal advice or sharing confidential information, remind the internal stakeholder recipients that they should not circulate legal advice or privileged communications widely among the stakeholders or outside the organisation
- Develop a policy and internal training about LPP to reduce the risk of inadvertent disclosure of privileged communication.
Cady Simpson is a member of the QLS In-house Counsel Committee.
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