Noticeboard
| Published date | 01 March 2005 |
| DOI | 10.1350/ijep.9.2.132.64810 |
| Date | 01 March 2005 |
| Subject Matter | Noticeboard |
132 THE INTERNATIONAL JOURNAL OF EVIDENCE & PROOF
NOTICEBOARD
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East Anglia, Norwich NR4 7TJ, UK. E-mail: R.Pattenden@uea.ac.ukEast Anglia, Norwich NR4 7TJ, UK. E-mail: R.Pattenden@uea.ac.uk
East Anglia, Norwich NR4 7TJ, UK. E-mail: R.Pattenden@uea.ac.ukEast Anglia, Norwich NR4 7TJ, UK. E-mail: R.Pattenden@uea.ac.uk
East Anglia, Norwich NR4 7TJ, UK. E-mail: R.Pattenden@uea.ac.uk
Legal advice privilege—United Kingdom
Legal advice privilege protects confidential communications passing between lawyer
and client for the purpose of seeking or receiving legal advice, whether or not litigation
is in prospect. Previous issues of the Noticeboard have noted how two decisions of the
Court of Appeal (Three Rivers District Council v Bank of England (No. 5) [2003] QB 1556 (as
to which see (2003) 7 E & P 198) and Three Rivers District Council v Bank of England (No.
6) [2004] QB 916 (as to which see (2004) 8 E & P 191)) have eroded legal advice privilege
by (1) adopting for organisations a restrictive definition of ‘the client’ and (2) confining
the privilege to advice about legal rights and liabilities. Both cases were against the
Bank of England and a consequence of the collapse of the Bank of Credit and
Commerce International (BCCI) in 1991.
The government reacted to BCCI’s collapse by setting up a non-adversarial non-
statutory inquiry, known as the Bingham Inquiry, to investigate the Bank of England’s
supervision of BCCI. The bank appointed three of its officials to liaise with the Inquiry.
This became known as the Bingham Inquiry Unit (BIU). The BIU retained Freshfields,
a firm of solicitors, as its legal advisers. All communications between the BIU and
the Bingham Inquiry were the subject of advice by Freshfields. After publication of
the Bingham Inquiry Report in 1992, the BCCI liquidator and BCCI depositors sued
the bank for misfeasance in public office. Initially, they sought disclosure of
documents created for Freshfields by bank employees not belonging to the BIU and
later disclosure of communications between the BIU and Freshfields. In Three Rivers
No. 5 the Court of Appeal decided that only the BIU was to be regarded as Freshfields’
‘client’ and therefore documents provided to Freshfields by the Bank’s other employees
stood in the same position as information from an independent third party. That is
to say, they were capable of being protected by litigation privilege if made for the
dominant purpose of being used in adversarial litigation (which these
communications were not), but not legal advice privilege. Leave to appeal to the
House of Lords was refused. Subsequently, in Three Rivers No. 6 the Court of Appeal
upheld an order that the bank disclose communications between the BIU and
Freshfields because the dominant purpose of these communications was to obtain
THE INTERNATIONAL JOURNAL OF EVIDENCE & PROOF (2005) 9 E&P 132–147
THE INTERNATIONAL JOURNAL OF EVIDENCE & PROOF 133
NOTICEBOARD
advice about the presentation of the bank’s evidence to the Bingham Inquiry rather
than advice about the bank’s legal rights and obligations.
The second case reached the House of Lords ([2004] UKHL 48, [2004] 3 WLR 1274)
where the decision of the Court of Appeal was unanimously reversed. Lord Scott, who
gave the leading judgment, said that legal rights and obligations must include
advice about public law rights, liabilities and obligations. The bank’s public law
obligations were under scrutiny in the Bingham Inquiry. A public inquiry operates
under the threat of judicial review of its proceedings and findings. The presentational
advice that Freshfields and counsel retained by Freshfields gave to the bank was
designed to avert criticism of the bank and therefore the need for the bank to seek a
judicial review. ‘It makes no sense … to withhold the protection of [legal advice]
privilege from presentational advice given by the lawyers for the purpose of
preventing that criticism from being made in the first place’ ([2004] UKHL 48 at [37],
per Lord Scott).
The Court of Appeal had questioned the justification for legal advice privilege (Three
Rivers (No. 6) [2004] QB 916 at [39]). According to Lord Scott, its rationale is that it
promotes candour between client and lawyer. The lawyer must have full knowledge
of the relevant facts in order to give appropriate legal advice. It is impossible to be
confident that the client will make a clean breast of things to the lawyer unless the
client is promised absolute confidentiality ([2004] UKHL 48 at [34]; see also at [54–
55]). That the client should do so is in the public interest: ‘The whole community
benefits when lawyers give their clients sound advice, accurate as to the law and
sensible as to their conduct’ (ibid. at [61], per Baroness Hale). Legal advice privilege is
thus a cornerstone of the rule of law. Once the policy justification for legal advice
privilege is appreciated, it becomes obvious that the Court of Appeal’s approach to
the privilege is too narrow. What matters is ‘whether the lawyers are being asked qua
lawyers to provide legal advice’ (ibid. at [58], per Lord Rodger). This goes beyond advice
about what the law is. All their Lordships endorsed Taylor LJ’s description of legal
advice in Balabal v Air India [1988] 1 Ch 317 as ‘advice as to what should prudently
and sensibly be done in the relevant legal context’ ([2004] UKHL 48 at [38], [59], [62],
[111]). The presentational advice given by Freshfields and counsel (‘and all internal
notes and memoranda relating thereto’ (ibid. at [45])) was advice ‘as to what should
prudently and sensibly be done’ in the legal context of the Bingham Inquiry and the
bank’s public law duties under the Banking Acts (ibid. at [43]; see also at [59]). ‘[T]he
BIU was instructing the lawyers in Freshfields to carry out a function which
necessarily involved the use of their legal skills if it was to be performed properly’
(ibid. at [60], per Lord Rodger).
When the lawyer’s advice is independent of a legal context, for example, if a solicitor
advises a client about a business matter such as investment or financial policy, the
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