Handy client guide to privilege:
Decision tree notes

1. Confidentiality

Every privileged communication must be confidential, but not every confidential communication will be privileged.

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2. Litigation in reasonable prospect

Litigation means “adversarial” proceedings. The chance of litigation need not be greater than 50%, but it must be more than a mere possibility. Litigation can be subject to contingencies, so long as there is sufficient prospect of those contingencies occurring.

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3. Dominant purpose of litigation

The document must have been created with the dominant purpose of obtaining advice or evidence in relation to the contemplated litigation, not the conduct of the litigation more broadly (see WH Holding Ltd v E20 Stadium LLP [2018] EWCA Civ 2652). Conducting litigation does however include avoiding or settling litigation that is in reasonable prospect (see SFO v Eurasian Natural Resources Corporation Ltd [2018] EWCA Civ 2006). If there is a dual purpose, and it cannot be established that the litigation purpose was dominant, litigation privilege will not apply.

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4. Lawyer/client communication

This raises a number of issues.

1. Who is a lawyer? A solicitor or barrister or qualified foreign lawyer. In-house lawyers are also included, so long as they are acting in a legal rather than an executive capacity. Privilege also extends to non-legally qualified personnel (eg, trainees or paralegals) acting under the supervision of a lawyer.
    
2. Who is the client? Following the Court of Appeal decision in Three Rivers District Council v Bank of England [2003] EWCA Civ 474 (Three Rivers No 5), as authoritatively interpreted by the Court of Appeal in SFO v ENRC [2018] EWCA Civ 2006, the "client" is limited to those individuals who are tasked with seeking and obtaining legal advice on behalf of the organisation. It does not include those who are authorised only to provide information to the lawyers. The Court of Appeal in ENRC expressed doubts as to the correctness of Three Rivers No 5, but said it was bound by precedent to apply it. Accordingly, unless and until the issue is revisited by the Supreme Court, communications between a lawyer and a non-client employee will not be privileged outside the litigation context. It is necessary to think carefully about which lawyer is advising and who is that lawyer's client in the particular circumstances. So, for example, where an in-house lawyer is merely gathering information from employees of the company to enable external lawyers to advise, those communications will not be privileged where the employees are not the external lawyers' client – see Glaxo Wellcome UK Ltd v Sandoz Ltd [2018] EWHC 2747 (Ch).
    
3. Requirement for communication? Privilege applies to draft communications as well as actual communications. Communication includes communication through agents, but this is quite limited.

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5. Giving/obtaining legal advice

The dominant purpose of the communication must be to give or obtain legal advice, rather than commercial input. However, legal advice is interpreted broadly in that: (i) it is not limited to what the law is, but includes advice as to what should be done in a relevant legal context; and (ii) the protection includes the exchange of communications aimed at keeping both lawyer and client informed so that advice may be sought and given as required (sometimes referred to as the "continuum of communications").

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6. Documents evidencing privileged communications

Privilege will apply to communications or documents (or parts of either) that reveal the substance of a privileged communication (eg, a board minute reporting on legal advice received). Where only part of a document is privileged, it can be redacted and the remainder disclosed.

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7. Subsequent dissemination of privileged material

In certain circumstances, privileged communications can be shared with others without losing privilege. This can be on two bases:

1. Common interest: The extent of common interest required is less than clear, but examples include insurer and insured, company and shareholder, principal and agent. The common interest must exist at the time the advice is shared.
    
2. Confidentiality: A party is entitled to share its privileged material with others on confidential terms without losing privilege as against the rest of the world. This applies regardless of whether there is a common interest.

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