Privilege series part 2: Implied waiver in claims against solicitors

Our series focused on privilege considers issues encountered by practitioners across a range of dispute resolution specialities. This blog explores legal professional privilege in the context of claims against solicitors.

When solicitors are sued in their professional capacity, an important question arises as to whether documentation relevant to the claim remains subject to legal professional privilege.

Case law concerning this topic has varied over time and the answer usually depends on two factors:

1. who is suing the solicitor; and,
2. whether documents fall outside of direct communications between the solicitor and client and involve any third parties (either related or unrelated to the claim).

Initially, whether documentation remains protected by privilege will depend on whether the action is being advanced by the solicitor’s client or by a third party.

Claims brought by third parties against solicitors

It is established law that legal professional privilege is a right which belongs to clients. Because of this, in the rare scenario where a claim is brought by a third party against a solicitor (i.e. not a named client of the solicitor as established through a contractual or tortious relationship), the underlying documents remain privileged, save for in the following three scenarios:

1. The client has waived privilege over documents either expressly, or through the deployment of privileged material in litigation; and/or,
2. Documents and communications have been brought into existence as part of, or in furtherance of, iniquity (known as the “iniquity exception”); and/or,
3. The third party claims to be the client’s successor in title.

Claims brought by clients against solicitors

When solicitors are sued in their professional capacity by their clients, common law confirms that the client will have “impliedly waived” privilege in respect of all matters that are relevant to the claim being pursued.

The case of Lillicrap v Nalder (a firm) made clear that by suing a solicitor, clients have invited the court to “adjudicate the dispute” and therefore have waived the “privilege and confidence to the extent that it is necessary to enable the court to do so fully and fairly in accordance with the law”.

This was elaborated on by Bingham L.J in Paragon Finance Plc v Freshfields (A Firm) who emphasised that by advancing public court proceedings, the client has “brought that confidential relationship between solicitor and client into the public domain” and, as such, a client cannot thereafter claim the protection of legal professional privilege.

Similarly, in the interest of “fairness” such a waiver prevents a solicitor from being restrained by an obligation of confidence when defending themselves against a claim.

Limitations to implied waivers

However, case law has also espoused the narrow application of implied waivers and determined the following scenarios where an implied waiver would not apply:

1.  Documents relating to work undertaken by a successor solicitor

Lord Justice Bingham made clear in Paragon Finance that an implied waiver cannot extend to the confidential communications between a client and their “successor solicitors”. As the clients have not sued their successor solicitors, they have not opted to bring that confidential relationship into the public domain.

2. Documents from the claimant’s former solicitors, now in the hands of the solicitor being sued

Whilst the case of Hayes and Rowson v Dowding found that a former solicitor’s documents would be subject to an implied waiver, Paragon Finance overruled this decision, emphasising that the implied waiver will “cover no communications to which the solicitor [being sued] was not privy”.

3. Documents relating to work undertaken by in-house solicitors

In the case of Banque Bruxelles Lambert SA v Simmons & Simmons, the court held that a solicitor’s contributory negligence defence did not impliedly waive privilege over the claimant’s in-house legal adviser’s files. Justice Blackburn was firm that a waiver relates only to communications between a client and the solicitor they are suing and that Lilicrap did not intend to “establish any wider principle”.

Counsel’s documents 

A curious anomaly however exists with implied retainers when it comes to counsel’s papers.

In Hellard and another v Irwin Mitchell, the court held that where an implied waiver applies to a matter between solicitor and client, it also extends to counsel’s papers (including counsel’s working papers and deliberations to which solicitors might not have been privy).

HHJ Purle held that as: “privilege attaches to confidential communications between solicitors, counsel and their clients, once there has been a waiver in relation to those communications, any evidence as to those communications can be adduced.”

Comment

Clients should be wary that communications with their solicitor and counsel may not be protected by legal professional privilege in the event that they bring a claim against their solicitor, and that such communications may be referred to in public proceedings.  

Case law however makes clear that the application of such a waiver is narrow and, save for counsel’s papers, will not extend beyond communications between the solicitor and client.

If clients are concerned about information being disclosed, consideration may need to be given to what information the client wishes to protect and why. While privacy concerns alone are unlikely to protect against disclosure, if information is commercially sensitive, it may be possible to make an application to court to prevent such information being disclosed to the wider public.

Further information

If you have any questions regarding this blog, please contact Elliot Grosvenor-Taylor in our Dispute Resolution team. 

 

About the author

Elliot Grosvenor-Taylor is an Associate in the Dispute Resolution Team at Kingsley Napley. Elliot’s practice covers a wide-range of areas but he has a particular interest in civil fraud and professional negligence related disputes. Elliot also acts in high-value international arbitrations.