In a couple of recent articles we have discussed the importance of legal professional privilege, including tips on how to ensure that it is attracted and maintained.
Those articles are available here and here, but as a quick refresher, legal professional privilege protects against the requirement for a party to disclose confidential communications between them and their lawyer where those communications were for the dominant purpose of that party obtaining legal advice (Client Legal Privilege), or where other materials were prepared for the dominant purpose of legal proceedings (Litigation Privilege).
Importantly, Client Legal Privilege is not limited to communications between a client and external legal advisors. In some circumstances, it may also apply to internal communications with a party’s in-house lawyers. However, because an in-house lawyer’s ‘client’ is its employer, and because in-house lawyers often wear many hats and perform other roles that are not necessarily legal (including management, executive, and governance duties) there are some additional considerations to be borne in mind.
This article explores when Client Legal Privilege will attach to communications with in-house lawyers and identifies several practical steps that can be taken by in-house lawyers and their employers to ensure that privilege is attracted and maintained as intended.
Acting as a lawyer
Client Legal Privilege will only apply where the relevant communication is with a lawyer, or where the relevant document is prepared by (or for) a lawyer.
A common difficulty with assessing privilege in the context of in-house lawyers is determining whether advice is given in a legal or other capacity. The answer to this question will depend on the particular circumstances and will require an assessment of the role of the in-house lawyer, as well as the context in which the relevant communication or document was created.
To be able to maintain Client Legal Privilege over communications with in-house lawyers a party will typically need to demonstrate that the in-house lawyer:
- was suitably qualified to practice law; and
- was acting in their professional capacity as a lawyer at the time.
While an in-house lawyer does not necessarily need to hold a current practicing certificate in order for Client Legal Privilege to apply, a current practicing certificate will assist a Court to infer that advice was given in their capacity as a legal practitioner.
Independence
Where an in-house lawyer is acting in their capacity as a lawyer, they will have certain ethical and professional obligations (including, for example, overriding duties to the Court and the administration of justice). The Court will be much more willing to find that Client Legal Privilege applies where advice has been provided in a manner that complies with the in-house lawyer’s ethical and professional obligations as a lawyer (as opposed to, for example, advice that is entirely driven by commercial imperatives).
There is some debate about whether there is a separate and additional requirement for ‘independence’ before privilege can apply for in-house lawyers (separate and in addition to the requirement that the communication be for the dominant purpose of legal advice). However, the prevailing view appears to be that the degree of ‘independence’ is just one factor for consideration in determining whether the advice is given in a non-legal or legal capacity. What appears to be required in practical terms is that in-house lawyers need to be acting in their professional capacity as a lawyer, and providing advice that is consistent with their obligations as an officer of the Court.
Confidentiality
Any potentially privileged communication or documents must be kept confidential. If they are not confidential, then they cannot be privileged.
Care needs to be taken when sending advice or documents, even when they are only being shared internally within an organisation. Communications and documents should only be shared with the appropriate people involved in each legal matter, and those people should be informed as to the importance of keeping the material confidential.
Tips for attracting and maintaining privilege for communications with in-house lawyers
With the above in mind, the following practical steps should be taken (where appropriate) to give the best prospects of communications and advice from in-house lawyers being protected by Client Legal Privilege:
- legal communications and advice should be kept separate from other forms of communications and advice;
- in-house lawyer’s job titles should make it clear that they are a lawyer;
- where possible, in-house lawyers should keep up to date on Continuing Legal Education and hold current practicing certificates (noting that the cost of maintaining practicing certificates may not be appropriate for all businesses);
- where possible, the operations of in-house legal teams should not be managed by non-lawyers, or subject to direction by non-lawyers;
- the contents of any advice from in-house legal teams should not be subject to the direction or influence of, or alteration by, non-lawyers;
- documents that are intended to be confidential and privileged should be marked as such and should state the purpose for which they were created (i.e. for the purpose of the in-house lawyer giving legal advice to their employer); and
- written policies should reflect that the above steps have been taken.
More information
If you have any questions about legal privilege, whether in relation to in-house lawyers or otherwise, please do not hesitate to contact us:
Eve Dordhain
Senior Associate
M: 0408 989 801
E: edordhain@pageseager.com.au
Felix Craig
Lawyer
T: (03) 6235 5121
E: fcraig@pageseager.com.au
Published: 18 April 2024
