The Privilege Of Having Your Own In-House Lawyer

If you are lucky enough to work in a company that has its own in-house lawyer you already know that their legal and commercial advice can help you make better business decisions.  You may also know of the concept of legal professional privilege, which protects the disclosure of confidential communications between a lawyer (whether or not an in-house lawyer or external counsel) and that lawyer’s client.

Legal professional privilege allows those communications to not be discovered or turned over to the other side during litigation. Although privilege is usually claimed over documents, it also applies to verbal or electronic communications between a lawyer and their client.

Not every communication with a lawyer will be protected by privilege.  To obtain the significant protection that privilege affords, the communication must be confidential, be between the lawyer and their client and be for the dominant purpose of providing legal advice or for litigation (whether existing or anticipated).

For in-house counsel and the executives they work with, meeting these three tests is not as straight forward as it may sound.

For example, if the communication loses confidentiality then it will automatically lose privilege.

You also need to be mindful that the communication must be ‘between a lawyer and their client’.  Many in-house counsel have dual roles and the courts have been very clear that unless they ‘have their lawyer hat on’ and are acting in their capacity as a legal advisor, privilege won’t apply.

Finally, the communication must be created for the dominant purpose of seeking or providing legal advice, or for use in existing or anticipated legal proceedings.  The courts will assess the dominant purpose of a communication as a matter of fact, so you need to be particularly careful where a communication could have more than one purpose.  Singapore Airlines and Qantas found this out to their detriment when they were required to disclose a report they’d commissioned in relation to an incident which gave rise to a potential legal liability and litigation.  The court found that although the report contained legal advice the dominant purpose was not the provision of that legal advice and ordered the disclosure of the report to the plaintiff in connection with the dispute.

What can you do?

So, practically, what can you do to maintain privilege in your communications with your lawyer?

  • Keep it confidential – never tell anyone ‘I have legal advice that….’ Or ‘I am advised that…’ and keep the advice on a need to know basis within your organisation..
  • Think about what role your in-house lawyer is playing and when. If you want legal advice, ask for it separately from a commercial analysis.  If at all possible, have them produce the advice in a separate document.
  • Be clear on the purpose of any document or communication. Achieving two objectives in a single document or communication may be time effective but can blur the lines on whether the dominant purpose is legal advice.  The risk is that the advice must be disclosed.  For the same reasons, copying all correspondence to the lawyer will not be effective.

For further advice on legal professional privilege please do not hesitate to contact Michael Bett.

Written by Ben Tollner-Atkinson & Michael Bett