Legal advice privilege claims are subject to dominant purpose test

In this blog post Colin Passmore considers Jet2 v CAA, in which Morris J. held that claims for LAP are subject to a dominant purpose test.

Summary

For many years I have argued that the dominant purpose test does not apply, because it is not needed, in relation to legal advice privilege. Given that LAP protects confidential communications between client and legal advisor produced for the purpose of the client obtaining legal advice, I have struggled to envisage situations where the purpose of such communications can be anything other than for that purpose.

I had thought that this debate had been more or less shut down with comments made by the Court of Appeal in the recent ENRC decision, but it appears not: in Jet2 v CAA, Morris J. late last year held that claims for LAP are subject to a dominant purpose test. In my view (and I am not being a bad loser in saying this!), I still think that the DP test will be irrelevant to the vast majority of claims to LAP, but let’s look at why Morris J. held as he did.

The background

In R on the Application of Jet2.com Ltd v CAA [2018] EWHC 3364 (Admin), the court was asked to consider Jet2’s application for specific disclosure under CPR 31.12 in judicial review proceedings. Jet2 was seeking a number of documents relating to the release by the CAA of a press release and associated press coverage. Disclosure is not automatically ordered in JR proceedings (CPR54.16; written evidence may not be relied upon without the court’s permission or order); however, if “necessary in order to resolve the matter fairly and justly” (Tweed v Parades Commission [2006] UKHL 53) specific disclosure will be ordered.

Legal advice privilege

Documents sought by Jet2 included drafts of the CAA’s press release, drafts of one key piece of correspondence between the parties (a letter dated 01 February 2018) and related internal communications, over which the CAA asserted legal advice privilege. The CAA argued that its in-house lawyers were involved in discussions and giving legal advice on the drafts of the letter and the press release, and that, even when sent to multiple addressees (some lawyers, some not), drafts were being sent to the lawyer as part of the continuum of communication for the purpose of legal advice. The CAA also argued that the dominant purpose test didn’t apply but that, if it did, it was in any event satisfied.

In September last year, the Court of Appeal made some interesting but obiter comments on the DP test in SFO v ENRC [2018] EWCA Civ 2006 as follows at para 132:

‘In our judgment, however, it is hard to see why the suggested additional qualification [ie the DP test] is necessary, when the privilege can, by definition, only be claimed when legal advice is being sought or given. It is one thing to say that litigation privilege can only be claimed where the communication is created for the dominant purpose of the litigation, but entirely another to say that legal advice privilege can only be claimed where the communication is created for the dominant purpose of seeking legal advice. The second is tautologous.’

Exactly so - indeed, that accords with the view I have always taken on this issue. But in Jet2 Morris J. thought that comment was driven by the circumstances of the ENRC case. It is not clear why he said that. He went on to derive from the leading authorities on LAP (see para. 95 of the judgment) the following principles:

  • (A) the “mere involvement of a lawyer is not enough to justify a claim for privilege”; emails sent both to the lawyers and non-lawyers seeking commercial views are not privileged communications

  • (B) Legal advice privilege “applies only to confidential communications between client and lawyer which are made for the purpose of giving or obtaining legal advice where a lawyer has been instructed for the purpose of giving legal advice on a matter”. This includes documents prepared for communication to the lawyer and information passed between client and lawyer as part of continuum of communications between them in relation to the matter, provided they are directly related to the performance by the lawyer of his professional duty as legal adviser to the client

  • (C) Legal advice privilege does not apply to documents which are “merely raw materials” and not created for the purpose of obtaining legal advice. This means that:

“[d]ocuments which come into existence during the course of a transaction or event (for example created before legal advice is sought) and not created for the purpose of legal advice are not protected by legal advice privilege, (nor generally are copies of such documents even where the copies are forwarded to or made by the solicitor (unless issues arise as to selection)…”

  • (D) “claims for legal advice privilege are, in principle, subject to a dominant purpose test, namely whether the communication or document was brought into existence with the dominant purpose of it or its contents being used to obtain legal advice”.

  • (E) When looking at communications with multiple addressees, some of whom are lawyers and others not, the dominant purpose of the communication will determine whether or not it is protected by privilege. Per Morris J:

(1)“if the dominant purpose of the email is to seek advice from the lawyer and others are copied in for information only, then the email is privileged, regardless of who it is sent to. (2) If on the other hand, the dominant purpose of the email is to seek commercial views, and the lawyer is copied in, whether for information or even for the purpose of legal advice, then the email, in so far as it is sent to the non-lawyer, is not privileged. (3) Further, if sent to the non-lawyer for a commercial comment, but sent to the lawyer for legal advice, then, in my judgment, the email is not protected by privilege, unless it or the non-lawyer's response discloses or might disclose the nature of the legal advice sought and given.”

The CAA was invited to “reconsider” its position on legal advice privilege in the light of those statements of principle and to disclose further documents accordingly or to provide a witness statement to explain why privilege claims were being maintained.

Discussion on dominant purpose

One can have no real debate with the principles identified by the Judge at (A) to (C) above and with most of (E) - this is all good stuff. However, I still struggle with (D) and quite why a DP test is needed, even with the examples the Judge gave in (E): in each of these, if the word ‘dominant’ is removed then the tests still work, including in the example in E3. There we are: and I suppose many will say ‘does it really matter’ and at least we have (long-awaited?) clarity even if as I continue to think it does not much matter. There is of course the argument that the DP test has been accepted for many years in the context of litigation privilege (Waugh v British Railways Board), where I accept that it both works and is in any case vital in that arena. But I am not persuaded that thereby it needs to be transported over to claims to LAP – as the CoA said in ENRC, its use there is tautologous. Further, I suspect it will just encourage more challenges in a handful of cases as to whether the purpose is truly dominant.

Perhaps in fairness to Morris J, I ought to recognise that the issue of dominant purpose and LAP is likely to be most acute for in-house lawyers, who will all too often find themselves dealing with both the legal and commercial aspects of a particular issue or matter. Considering whether a document has been brought into existence for the purpose of seeking legal advice may well be slightly more challenging in those circumstances and perhaps the dominance of the purpose helps to throw light on the availability of the privilege. As Morris J. said:

“Lawyers, particularly in-house solicitors, may often take part in general business discussions which do not involve legal advice. Where the in-house lawyer is clearly being asked for legal advice, privilege is likely to attach. However, where the in-house lawyer is being consulted also as an executive about a largely commercial issue, then the dominant purpose test will fall to be applied.”

I can live with that, but again I would test the proposition by asking whether, if the analysis is undertaken without reference to the need to show dominance then surely we still get to the same answer? That is the case, in my view, even with the Judge’s holding in Jet2 that drafts, for example of the 01 February 2018 letter, which were created before the CAA’s in-house lawyers were consulted, or created without their involvement, would not be privileged “unless the dominant purpose of the person creating the draft was to seek legal advice on it”. Why is it not enough to look just at the purpose of their creation and then at how the draft was used: was it sent to a lawyer to advise on potential legal issues - if so then it is privileged; or was it sent to a commercial colleague then it cannot be; if it was sent to both, then the draft cannot be privileged (unless it reveals legal advice to any extent) but any accompanying instructions to the lawyer (but not the commercial colleague) will be protected.

As ever, it is those at the sharp end of dealing with and creating documents where both legal and commercial issues are in play, which obviously includes senior management and in-house counsel, who need to be most alive to these issues – quite aside from the on-going ‘who is the client ‘conundrum (even post ENRC). And there is in my view a solution which is mostly practical and that is that communications to legal advisors should so far as possible be kept separate from commercial communications (as well as marked “privileged”), and care should be taken when circulating documents within the business which deal with, or are communications about, legal issues. As Morris J makes clear in Jet2, sending documents to mixed (legal and non-legal) recipients for mixed (legal and non-legal) purposes will unnecessarily blur the lines, and may well undermine the claim to privilege over such documents (even if legal advice is being sought from one of the recipients).

This document (and any information accessed through links in this document) is provided for information purposes only and does not constitute legal advice. Professional legal advice should be obtained before taking or refraining from any action as a result of the contents of this document.