The question of whether lawyers’ notes of interviews with company employees in the course of an investigation are privileged has been a hot topic recently. That is mainly due to the SFO’s various statements on how it will treat any claims to privilege made over interview notes where the company was internally investigating potential criminal wrongdoing. One of the challenges that arises here is whether litigation privilege is available to protect such notes, or whether the party asserting privilege has to fall back on legal advice privilege, in which case issues arising from the well-known Three Rivers (No. 5) come into play. These issues are not confined to criminal matters, they also arise in civil litigation, as the recent rulings in Astex Therapeutics Ltd v AstraZeneca AB demonstrate.
This decision concerned a commercial dispute as to how certain drugs should be categorised under a co-operation agreement between the two pharmaceutical companies involved. AstraZeneca had carried out an internal review on this issue which pre-dated the dispute. For this purpose, a number of its current and former employees were interviewed. The conclusions drawn from this review led to the disagreement but, when it came to disclosure, AstraZeneca claimed privilege over the notes of interviews made during the review.
Several points arise from this case that are worthy of a reminder, even if they do not break entirely new ground.
Any claim to privilege in a disclosure list needs to be specific
The Defendant in its disclosure list included a section to cover privileged documents (not to be available for inspection) that read:
“Confidential letters and other communications passing between the Defendant and its legal advisors and patent attorneys for the purposes of giving or obtaining legal advice and assistance, together with drafts and internal memoranda and notes thereof prepared for the purposes of giving or obtaining legal advice, and any other documents which are by their nature privileged and excluded from inspection.”
Chief Master Marsh said that this generalised wording at the end “has no place in modern litigation, let alone litigation of very real complexity. It is clearly unhelpful, without describing the documents said to be privileged, to say that ‘their nature’ explains why they are privileged because the recipient of the list of documents has no way of knowing which documents, or classes of documents, are being referred to.”
Disputes over privilege are discouraged by the court
Parties’ lawyers effectively act as judges of privilege over their client’s documents, which means that it is necessary for them to be as specific as possible where an issue arises as to whether privilege is properly being claimed. The court will intervene only where it has a serious concern that the test is not being applied properly, but that makes it incumbent upon the party asserting privilege to give as full reasons as it can in correspondence.
Where a party has produced an affidavit in support of an assertion of privilege, case-law provides the court with four options if the claim to privilege is challenged:
- order disclosure on the basis that the reasons disclose no grounds for an assertion of privilege
- order a further affidavit to answer specific questions
- order cross-examination of the person who provided the affidavit (rarely appropriate), or
- review the documents itself to determine the claim for privilege, which is a last resort.
The requirements for Legal Advice Privilege
The defendant claimed both legal advice and litigation privilege for attendance notes made of conversations or meetings with its current and former employees, which occurred as part of the internal review. The Master noted that in Balabel v Air India, Taylor LJ held that LAP extended beyond communications with a lawyer requesting or giving advice, to the “necessary exchange of information between client and lawyers of which the object is the giving of legal advice as and when appropriate”.
However, the information must still pass between lawyer and client. In the context of corporations, that means applying Three Rivers (No.5) to identify who is the “client” within the company, as it will not be every employee. Only those authorised to seek legal advice will be the “client” and in this case few of the employees interviewed were in that position, so LAP could therefore not apply to the interview notes.
In one sense, this is not a surprising conclusion and echoes the result in Three Rivers (No.5) itself. However, what would have been helpful would be to know the nature of these attendance notes. There is little in the judgment to indicate whether the notes were merely verbatim notes of what was said (clearly not privileged) or whether they were in the form of a memorandum/summary report sent to the client (probably privileged): as in the 1987 decision in Re Sarah C Getty Trust.
Even then, there are degrees between these two options. As Warren J. said (in relation to litigation) privilege in The Stax Claimants v The Bank of Nova Scotia Channel Islands Limited (2007):
“ … if a note of a conversation were also to contain the note-taker’s own thoughts and comments on what he is recording with a view to advising his client, the position would almost certainly be different: it is difficult to see why such a note should not attract litigation privilege.”
The same would apply in relation to advice privilege.
The requirements for Litigation Privilege
The Master also considered the standard test for whether Litigation Privilege applies and found that litigation was not in reasonable contemplation at the time the review was carried out, nor was it the dominant purpose. This is often an issue, as a review may be commenced to ascertain the company’s position on something, or to discover why something went wrong, with any potential litigation simply an afterthought. This was not a situation where the nature of what was being discussed obviously raised the prospect of contentious proceedings, as would usually be the case in an investigation into allegations of criminal wrongdoing. The Master here held that some objective evidence needed to be presented in order to make good an assertion that litigation was in contemplation: the party asserting privilege cannot simply state that they had litigation in mind.
The need for care
The case shows once again that any claim to privilege need to be carefully examined both by the party making it and the opposing party. The court may be slow to look behind a claim to privilege made by reputable solicitors, but vague claims over whole categories of documents are unlikely to escape scrutiny. If such claims prove ill-founded, disclosure of the documents will be ordered.