Legal professional privilege: High Court finds no privilege in identity of third party that provided lawyers with document for purpose of litigation

The High Court has granted a Norwich Pharmacal order against a firm of solicitors requiring them to disclose the identity of a consultancy from whom they obtained a report that their client had deployed in litigation against the claimants. The court found it was strongly arguable that the report was a forgery and was put together with assistance from an insider in the claimants' organisation, and there was a realistic prospect that the information would assist the claimants to identify the wrongdoer and obtain redress: Filatona Trading Ltd v Quinn Emanuel Urquhart & Sullivan UK LLP [2024] EWHC 2573 (Comm).

The High Court held that the identity of the consultancy was not protected by litigation privilege, as privilege attaches to communications (including secondary evidence of those communications) rather than information or facts divorced from them. Applying the approach established by the Court of Appeal in Loreley Financing (Jersey) No 30 Ltd v Credit Suisse Securities (Europe) [2022] EWCA Civ 1484, considered here, it follows that the identity of those communicating with a lawyer is not in itself privileged unless disclosing that identity would tend to reveal something about the content of communications with the lawyer or the litigation strategy being discussed.

In Loreley, the court held that the identities of those instructing a lawyer on behalf of a corporate client were not privileged as they would reveal nothing about the content of the communications. In contrast, as recognised in Loreley and previous case law, the identity of potential witnesses a lawyer has contacted may be privileged, as that would tend to reveal the advice as to litigation strategy.

In the present case, the court held that identifying the consultancy from whom the alleged forgery was obtained would reveal nothing about the content of any privileged communications or the litigation strategy, not least because the client had already deployed the contents of the report in the underlying litigation.

While the court held that the identity was not privileged at all, rather than that the privilege had been waived, it is not entirely clear whether the decision would have been the same if the application was made before the report had been deployed in any way. At that point it seems arguable that the position of a third party the lawyer has contacted to obtain potential documentary evidence (where that evidence is not in the control of the client) would be analogous to the position of a potential witness from whom no statement has been served, in that disclosing the identity of either may tend to reveal advice as to litigation strategy.

In addition to the discussion of privilege, the decision is an interesting – and rare – example of the court granting Norwich Pharmacal relief against a law firm on the basis that they have been "mixed up" in wrongdoing. The court rejected an argument that the lawyers were a mere witness, having simply been provided with a copy of a document on which they were asked to advise. In the court's judgment, the lawyers were not a mere onlooker or witness, but were actively involved in the verification and deployment of the document in the proceedings – albeit without knowledge of the wrongdoing.

The decision is also of interest in illustrating that the information sought under a Norwich Pharmacal order does not have to enable the applicant, without more, to seek redress against the wrongdoer. It is sufficient if there is a realistic prospect that the information will assist in identifying the wrongdoer, eg by identifying a "middleman" who may be able to identify the wrongdoer.

Background

The application arose in the context of a complex and long-running dispute between Oleg Deripaska and Vladimir Chernukhin relating to a joint venture in a Russian textiles manufacturer referred to as TGM.

In 2017, Mr Chernukhin and his associated company (the Chernukhin Parties) obtained an arbitration award which found that the conduct of Mr Deripaska and his associated company (the Deripaska Parties) was unfairly prejudicial and which ordered them to buy out the Chernukhin Parties for some US$95 million. The Deripaska Parties unsuccessfully challenged that award in the English courts.

In 2020, the Chernukhin Parties issued proceedings against the Deripaska Parties seeking to set aside the arbitral tribunal's award and remit the question of quantum to the tribunal. They alleged that the award was vitiated by a fraud committed by the Deripaska Parties in suppressing a report referred to as the Glavstroy Report. This purported to be a feasibility study dated 18 May 2016 for the redevelopment of TGM's site in Moscow. The Chernukhin Parties alleged that, had it been produced to the arbitral tribunal as it should have been, the Deripaska Parties would have been ordered to pay US$395 million rather than US$95 million.

The evidence of the Chernukhin Parties in the set-aside proceedings was that the Glavstroy Report had been obtained by QE, as solicitors advising the Chernukhin Parties (though they were not on the record in the arbitration or the set aside proceedings), from a London based Business Intelligence Consultancy in September 2019.

The Deripaska Parties maintained that the Glavstroy Report was a forgery, including on the basis that although it purported to date from May 2016 it referred to an official document dated April 2018 and used a logo that was not in fact in use until 2017.

QE refused to identify the consultancy on the basis that both it and the consultancy were said to have "serious concerns" about the safety of the ultimate source of the Glavstroy Report if they did so. They explained, however, that the report had been obtained by the consultancy via "trusted sources". The set aside proceedings were eventually withdrawn in 2020.

In September 2021, the Deripaska parties issued the present application for Norwich Pharmacal relief ordering QE to disclose the identity of the consultancy. It did not maintain an application for disclosure of the ultimate source of the Glavstroy Report, as QE had explained it did not have that information, but submitted that disclosure of the identity of the "middleman" was proportionate and necessary as it would assist in identifying the ultimate source, if necessary through a further application against the consultancy.

QE resisted the Norwich Pharmacal application primarily on the basis that the identity of the consultancy was privileged, as QE had engaged and communicated with the consultancy for the dominant purpose of seeking evidence for use in the underlying litigation, and therefore the information sought was contained in communications that were covered by litigation privilege.

Decision

The High Court (Calver J) granted the Norwich Pharmacal order against QE.

Threshold conditions for Norwich Pharmacal relief

The judge noted that the three threshold requirements for Norwich Pharmacal relief are well-established and found that, on the facts, they were all satisfied in this case.

1. The arguable wrong condition: It must be arguable that some legally recognised wrong has been committed against the applicant, eg a crime, tort or breach of contract.

In the present case the court considered it strongly arguable that the Glavstroy Report was a forgery, and all the evidence pointed to it being designed to cause very considerable loss to the Deripaska Parties. There was therefore plainly a good arguable case that a legally recognised wrong had been committed against them, including the torts of conspiracy or malicious falsehood or potentially a crime or criminal contempt.

2. The "mixed up in" condition: The respondent to the application must have been mixed up in the wrongdoing.

Although the court in the Norwich Pharmacal case itself referred to "facilitation" of the wrongdoing, the judge in the present case would (if it had mattered) have followed the approach in more recent Court of Appeal authorities that it is sufficient if the respondent was involved in some way in the wrongdoing. In any event, the judge was satisfied that, on the facts of this case, QE had not only become involved in the wrongdoing but had unwittingly facilitated it.

The judge rejected QE's argument that it was a mere witness, being simply a lawyer provided with a copy of a document on which it was asked to advise. They were not a mere onlooker or witness, but were actively involved in the (unwitting) verification and deployment of the document in the proceedings, when it was strongly arguable that it was a forgery.

3. The possession condition: The respondent must be likely to be able to provide the information or documents necessary to enable the ultimate wrongdoer to be pursued.

The judge noted that this condition does not mean the applicant must show redress would be impossible without the disclosure sought, but in any event in the present case the judge accepted that there was no realistic prospect of the Deripaska Parties being able to seek redress unless the order was made.

It is also not necessary that the applicant intends to bring legal proceedings against the wrongdoer, as opposed to seeking some other lawful redress (such as dismissing an employee, for example). In the present case, given the nature of the Glavstroy Report, there was a convincing case for inferring that it was put together with assistance from someone within Mr Deripaska's organisation. Therefore disciplining or dismissing any individuals concerned, or bringing criminal proceedings or criminal contempt proceedings against them, were all potentially viable forms of redress for the Deripaska Parties in this case.

Further, the applicant need not show that the information sought will enable it, without more, to seek redress. It is sufficient if there is a realistic prospect that the information will assist in identifying the wrongdoer, eg by identifying a person who may be able to identify the wrongdoer. In the present case, the judge was satisfied that there was such a realistic prospect, and indeed that the disclosure would in all probability lead to the identity of the original source, if necessary because the Deripaska Parties would be able to apply for Norwich Pharmacal relief against the consultancy.

The overall justice of the case

If the threshold conditions for Norwich Pharmacal relief are satisfied, the court will consider whether requiring disclosure is an appropriate and proportionate response in all the circumstances of the case, bearing in mind the exceptional but flexible nature of the jurisdiction.

Privilege

In considering the question of overall justice, the court first considered QE's argument based on privilege, and concluded that it was flawed.

QE sought to rely on comments in China National Petroleum Corp v Fenwick Elliott [2002] EWHC 60 (Ch), in which the claimants were concerned that the defendant's solicitor was obtaining confidential information from one of their (current or former) employees and sought disclosure of the witness's identity. The High Court was not satisfied that there was any evidence that the claimants' confidential information had been obtained in that way, but went on to note that both the information given by a potential witness and the identity of that witness would be privileged.

The judge in the present case did not consider the two situations to be equivalent. The starting point is that litigation privilege and legal advice privilege are concerned with communications, and not merely facts or information. It is the content of the communications that are protected from disclosure.

It followed that, as per the Court of Appeal's decision in Loreley, above, the identity of those communicating with a solicitor in relation to litigation will be protected by litigation privilege only if disclosure of that identity would inhibit candid discussion between the lawyer and the client. In general, the Court of Appeal considered, there would be no such inhibition, as disclosure of the existence of such communications or the identity of those communicating would reveal nothing about the content of the communications.

In Loreley, the court noted that, in an unusual case, identification of the person giving instructions to the solicitor (which was the information sought in that case) might tend to reveal something about the content of the communication or the litigation strategy being discussed, but that would need to be explained as the basis of a claim for privilege. That explained the decision in China National Petroleum, because identifying a potential witness would necessarily tend to reveal the solicitor's advice as to litigation strategy.

But in the judge's view, identifying the consultancy in this case would reveal nothing about the content of any privileged communications or the litigation strategy of the Chernukhin Parties, not least because they had already deployed the contents of the Glavstroy Report in the underlying proceedings. The judge commented that this was not a case of waiver leading to the loss of the privilege. Rather, the identity of the consultancy was not privileged information at all.

Other factors

The judge considered that the application was strongly supported by the fact that: there was a strongly arguable case of very serious wrongdoing, such that there was a strong public interest in allowing the Deripaska Parties to vindicate their legal rights; the making of the order was likely to deter similar wrongdoing in future; and the information could not be obtained from another source.

Against those factors, the court did not consider there to be reliable evidence to support the Chernukhin Parties' suggestion that the consultancy or its relevant employees might be at risk of physical harm if their identities were disclosed.