Where an advisor is engaged to assist the Legal Counsel by providing legal advice, this should be clearly stated in the order letter explaining the scope of the assignment and why the counsel`s services allow the Counsel to provide legal advice. If an advisor has an ongoing relationship with the company to provide expertise and is then hired to assist with a legal matter, a separate order letter for a discreet assignment must be completed with a lawyer. As more and more companies use independent contractors and specialists, courts continue to define where these independent contractors are appropriate for solicitor-client privilege purposes. Here we discuss recent decisions that assess whether third-party waiver exemptions, where a third party is a functional employee1 or is essential to provide legal advice, 2 apply to other third parties, including industry specialists, accountants, property managers or investigators. Parties wishing to protect the advice of their internal or external counsel: (a) should carefully consider whether the communication or meeting of LAPs should be protected; (b) to the extent possible or possible, do not confuse commercial and legal issues in e-mails with more than one addressee or, if this is not possible, the sender should ensure that it is clearly stated that the primary purpose of e-mails with multiple recipients is to provide or obtain legal advice; (c) consider that emails and attachments should be reviewed separately for the purposes of the LAP; and (d) ensure that only employees specifically hired to provide legal advice on behalf of the client contact lawyers. Political reasons for granting privileges to communications with third parties In Balabel v. Air India ([1988] Ch 317), the Court of Appeal interpreted the scope of legal advice broadly, noting that in most solicitor-client relationships, there will be a continuum of communications to keep both informed in order to facilitate the provision of legal advice as required. The court ruled that all such communications would attract LAP, confirming that legal advice is not limited to telling the client what the law is, but also includes advice on what should reasonably be done in the relevant legal context. Universal Standard submitted that emails were privileged and that communication with the public relations firm did not constitute a waiver because: (1) the public relations firm was necessary to facilitate communication between counsel and client; (2) the public relations firm was the “functional equivalent” of an employee of the firm; and (3) the public relations firm was a consultant appointed by lawyers to assist in carrying out specific tasks that “promote the broader public interest in the observance of the law and the administration of justice.” The Court concluded that none of the exceptions were applicable and that the privilege had been waived.
Legal advice is not limited to communicating the law to the client; It should include advice on what to do prudently and wisely in the legal context.1 Essentially, solicitor-client privilege is held by the client, meaning that if there is a strong strategic reason for waiving the privilege, it is the client (not the lawyer) who chooses such a waiver. [4] However, client privilege is often revoked involuntarily. [5] Sending privileged communications to an unprivileged third party, or even discussing inside information with them, destroys the underlying privilege. The most common example is the forwarding of an otherwise privileged email from your lawyer to an otherwise uninvolved third party. Even though this person may be friendly to your goals, the privilege was destroyed by the act of transfer, so in a future lawsuit, your opponent may be entitled to discover your lawyer`s underlying email and use it against you. The safest rule of thumb is not to discuss legal advice with third parties unless it is well thought out in advance. Traditional black letter law teaches that the presence of an external third party or third party in an otherwise privileged communication waives privileges. However, the courts have found two exceptions to this rule: (1) where the third party is involved in helping a lawyer understand and interpret complex principles, and (2) where the third party is so well integrated into the business that it should be treated as functionally equivalent to an employee. In Universal Standard Inc. v. Target Corp., 331 F.R.D.
80 (S.D.N.Y. 2019), a trademark dispute, the issue was whether joint privileged communication between lawyer and client with a public relations firm waives privilege. After Universal Standard`s chief of staff and in-house counsel were fired, Target`s lawyer began asking about emails sent between Universal Standard, its lawyers and a public relations firm hired by Universal Standard as part of its lawsuit against Target. Universal Standard asserted that the emails were protected by solicitor-client privilege. Target disagreed. Similarly, courts have regularly granted claims of privilege in cases involving consultants, accountants, investigators, public relations firms and non-testatious experts. See NXIVM Corp. v. O`Hara, 241 F.R.D. 109, 138 (N.D.N.Y.
2007) (investigator and accountant); H.W. Carter & Sons, Inc. v. William Carter Co., No. 95 CIV. 1274, 1995 WL 301351, at *3 (S.D.N.Y. May 16, 1995) (public relations consultant); U.S. Postal Serv. v. Phelps Dodge Ref. Corp., 852 F. Supp.
156, 161 (E.D.N.Y. 1994) (accountants and non-witness experts); see also In re Copper Mkt. Antitrust Litig., 200 F.R.D. 213, 217 (N.S.D.Y. 2001). The privilege applies only to confidential communications, that is, if the communication is no longer confidential, it is no longer privileged. If a document is widely distributed or made public, the right may be lost. To extend the privilege without limitation to all communications between lawyers and clients on matters that are part of a lawyer`s normal business and that relate to that relationship is too broad.
Lawyers` working papers are also preferred if they betray the content of the lawyer`s legal advice. The court held that DMI had not demonstrated that Chastain`s participation met this test, as there was no documentation of Chastain`s obligations to DMI or its management consultant, nor evidence that Chastain had specialized knowledge, such that legal counsel would rely on him to facilitate legal advice for the company. In addition, the court found “little to suggest that the communication between Chastain and DMI`s lawyer was primarily legal rather than commercial.” 5 LAP does not apply to communication with an in-house lawyer in the context of a European Commission investigation into competition law. In these circumstances, LAP can only be invoked if an external lawyer has been engaged and has provided the advice in question. The plenary was convinced that his approach would not lead to an “uncontrollable extension of privilege”. He acknowledged that it would be difficult to meet the relevant purpose test. Indeed, the objective, not to mention the predominant objective, behind the preparation of commercial notices will generally be independent of the need for legal advice. “The less the client acts as a documentary information channel for legal counsel, the more he or she filters, adapts or exercises independent judgment as to which third party document is to be disclosed to legal counsel, the less likely it is that that document will be privileged in the hands of the third party.
Indeed, the intended use of the document is more likely to be to advise and inform the client when he or she gives the client`s opinion to the lawyer. and not to record the communication to be made”. The multitude of new digital communication and social media platforms available in today`s technologically advanced world is a double-edged sword. As useful as they are for speeding up communication, opening new business avenues and fostering creativity, these platforms are fertile ground for the accidental disclosure of otherwise confidential legal information and advice. Whether through external hacking, unexpected “transfer,” or misdirected “inventory,” there`s a good chance most companies will end up facing a situation where confidential information escapes from the web and falls into unexpected hands. [1] Given that these disclosures can easily lead to litigation or play a role in litigation, it is important to understand what legal safeguards are in place to stop the use of this disclosed information as evidence in court. In rejecting the distinction between a communication prepared internally by a company and externally by a third party, Finn J. referred to the fact that solicitor-client privilege had been recognized not only as a substantive law rule, but also as an important common law immunity.