Privilege and withholding embarrassing documents
Are you
heading for a legal dispute? Or do you deal with sensitive issues that could be
pored over in court later? You should be aware of the law on disclosure of
documents and the implications of privilege.
The normal
rule in any civil dispute, including tax cases, is that both parties must
disclose documents which support or
adversely affect any party’s case. Failing to disclose documents, or
destroying them (including deleting emails) may be punishable as contempt of
court, and can result in the court drawing inferences from the absence of
documents you would expect to see. As soon as a dispute starts, your lawyer should
advise you on preserving and securing evidence – but it may be too late by
then. If the authenticity of documents may be questioned, particularly in
relation to emails and electronic documents and records, you may need to get
specialist help to preserve forensic-quality copies of the records with their
original date and time information.
But what if you
don’t want to disclose embarrassing evidence? You may be able to rely on privilege.
You are entitled not to disclose privileged evidence, and no
inferences can be drawn from your failure to provide it. The courts are
fiercely protective of legal professional privilege, which they see as fundamental
to our system of justice. Searches (by regulatory authorities, police or under
court orders) must be arranged to protect privilege.
There are
two kinds of privilege: legal advice privilege, which protects confidential communications
between lawyer and client, and litigation privilege. Legal advice privilege
covers communications between lawyer and client for the purpose of taking and
giving legal advice. It includes documents created for the purpose, but not the
client’s background preparations or reactions which are not to be communicated
to the lawyer. It applies whether or not there is a contemplated dispute. It
includes communications with in-house lawyers (except in EU competition cases)
but does not include general business advice which is not given in a legal context.
Litigation
privilege covers confidential communications or documents brought into
existence for the dominant purpose of use in actual or contemplated litigation,
including criminal proceedings or adversarial regulatory investigations, such
as competition inquiries by the OFT or FSA investigations. Unlike legal advice
privilege, it includes communications with third parties.
Privilege
can be waived, sometimes accidentally: if you waive privilege in a document to
advance your case on an issue, all other privileged documents relevant to that
issue also lose privilege. If you copy documents for some other purpose,
privilege may be lost, and it is lost if the documents cease to be
confidential. So care is needed to preserve privilege, including appropriate
markings: this lies behind the wording often seen on the bottom of emails about
privilege.
If your
business is dealing with sensitive issues, the last thing you want is for your
deliberations to be used in evidence against you. It may make sense to carry
out all your internal discussions with or through a lawyer, so that you attract
legal advice privilege. No other profession offers this advantage.
