Legal Advice Privilege: if your name’s not down…

Legal advice privilege – what’s it all about?

Legal advice privilege (LAP) is one of the two forms of legal professional privilege (LPP) which entitle clients to refuse to disclose certain confidential communication to other parties such as tribunals and regulatory bodies.

The principle is there to enable a client to place unrestricted confidence in their lawyer –this only applies to members of the legal profession (specifically members of the Bar, the Law Society, and the Chartered Institute of Legal Executives). Legal executives, trainee solicitors and paralegals are also covered, provided they are properly supervised by a qualified lawyer.

Who are the clients?

The ‘clients’ protected by LAP will only include those individuals who have been specifically tasked with seeking and obtaining legal advice. Where a client is a company, not all of the documents produced by its employees and sent directly to lawyers will be privileged.

Who are the lawyers?

Traditionally, LAP has only attached to advice given by members of the legal profession – it does not apply to other professionals who may give legal advice, e.g. accountants.

This was recently challenged in R (Prudential plc and another) v Special Commissioner of Income Tax and another [2013]. This appeal focused on the issue of whether LAP extends, or should be extended, to apply to legal advice given by someone other than a member of the legal profession.

Prudential had adapted a tax avoidance scheme devised by PricewaterhouseCoopers (PwC), and had entered into a series of transactions to give effect to this. When HM Revenue & Customs (HMRC) sought to investigate these, Prudential argued that it did not need to disclose documents that related to it seeking, and PwC giving, legal advice in connection with the transactions on the basis they were protected by LAP.

Its argument was rejected by the Supreme Court, which said that extending LAP documents containing legal advice given by professionals other than lawyers would undo a clear principle understood from previous authorities.

What communications are covered?

LAP covers legal advice as “to what should prudently and sensibly be done in the relevant legal context” (Three Rivers District Council & Ors v Bank of England [2004] UKHL 48), as opposed to being confined to advice on the law.

Therefore, it covers advice as to how evidence should be presented (presentational advice), and commercial advice, provided that that this relates to a client’s legal rights and is given in the relevant legal context. Pure business advice given by a lawyer will not be privileged because it lacks the relevant legal context.

What does this mean for employers?

Legal advice on employment law and tax is now regularly obtained from non-lawyers. Employers should be mindful that such advice will not be afforded the protection of LAP. For example, if you take advice from a non-lawyer (e.g. an HR consultancy) on a problem with an employee and that problem results in a claim before the Tribunal, any documents containing any such advice would be disclosable. If the advice was given by a qualified lawyer, any such documents could be lawfully withheld.

If you would like further information on this, or any other employment matter, contact Catherine McNulty, Solicitor in our Employment team.

Catherine McNulty
Tel: 0191 226 3801


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