Courts dealing with fall-out from Three Rivers ruling on privilege

Earlier in the month LawZone reported how Appeal judges concluded that legal privilege was “not merely difficult but unsatisfactory” and invited the government’s law reform body to take another look at legal advice privilege.

The Appeal judges upheld the earlier ruling of Judge Tomlinson last year in the Three Rivers litigation, who had a narrow interpretation of legal advice privilege when he ruled that legal advice should be restricted to “the seeking or obtaining legal advice concerning rights and/or obligations”.

Mr Justice Mann in USP Strategies and another v London General Holdings and Ors recently appeared to take a cautious line by ruling that, where privileged advice is disclosed to a third party, privilege attached to that communication because it was “evidence of the privileged advice within the formulation in Three Rivers”. “It does not matter whether that third party communication is of the whole of the advice or a paraphrase of or extract from the advice,” he said.

“If 100 per cent is privileged, then would communicating 99 per cent of it remain privileged? – it is hard to see why not. But if that is right, then why not 90 per cent, or 75 per cent, or 50 per cent?” the judge continued. “There is no reason to draw a line anywhere, and every reason not to. … The proper analysis, consistent with Three Rivers, is to continue to afford privilege to material which evidences or reveals the substance of legal advice.”

“While Three Rivers will undoubtedly see the courts examining assertions of advice privilege more readily, I certainly detect a desire on the part of the courts to maintain the integrity of legal advice privilege,” said George Burn, a senior solicitor in the dispute resolution department at Denton Wilde Sapte. “What we are seeing is an attempt by the courts to delineate more precisely the scope of advice privilege so as to make parties and their lawyers think more carefully about it.” Dentons acted for the claimants in USP.

At the time of writing, the Court of Appeal upheld ruling in the case of the United States of America v Philip Morris and British American Tobacco, which concerns Andrew Foyle, a partner at Lovells, in an action by the US Government against a number of big tobacco companies, including BAT, which Lovells represents in the UK.

In December last year the High Court in London ruled that Mr Foyle should comply with a request by the US Government for him to attend a hearing in the US to give evidence in the case. The High Court rejected his claim that he was protected from answering any questions by litigation privilege and today’s ruling appears to further narrow the protection offered by legal advice privilege.