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You are here: BAILII >> Databases >> England and Wales Court of Appeal (Civil Division) Decisions >> Three Rivers District Council & Ors v The Governor & Company of the Bank of England Rev 1 [2003] EWCA Civ 474 (03 April 2003) URL: http://www.bailii.org/ew/cases/EWCA/Civ/2003/474.html Cite as: [2003] QB 1556, [2003] CPLR 349, [2003] EWCA Civ 474, [2003] 3 WLR 667 |
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COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM THE HIGH COURT OF JUSTICE
QUEEN'S BENCH DIVISION (Commercial)
MR JUSTICE TOMLINSON
Strand, London, WC2A 2LL |
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B e f o r e :
LORD JUSTICE SEDLEY
and
LORD JUSTICE LONGMORE
____________________
 THREE RIVERS DISTRICT COUNCIL & Ors |
Claimant/ Appellant |
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| - and - |
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| THE GOVERNOR & COMPANY OF THE BANK OF ENGLAND | Defendant/ Respondent |
____________________
____________________
VERSION OF JUDGMENT
AS APPROVED BY THE COURT
CROWN COPYRIGHT ©
Crown Copyright ©
Lord Justice Longmore:
Bank of England ("the Bank") for misfeasance in public office. The Bank have claimed legal professional privilege for numerous documents which came into existence between the time when BCCI collapsed and the time when they made their final submissions to the Bingham Inquiry conducted by Lord Justice Bingham as he then was. The Bank does not claim that the documents were prepared in contemplation of litigation and are thus protected by that category of legal professional privilege which can be described as "litigation privilege"; rather the Bank claims that the documents are protected from disclosure by reason of that category of legal professional privilege known as "legal advice privilege", viz. privilege in relation to legal advice that is not founded on the existence or the contemplation of litigation. It is clear on the authorities that documents emanating from or prepared by third parties or employees of a party are covered by the principle of "litigation privilege" if prepared with the dominant purpose of use in existing or contemplated litigation. The scope of "legal advice privilege" is less clear. It is agreed that documents emanating from or prepared by independent third parties and then passed to the Bank's solicitors ("Freshfields") for the purpose of advice being given to the Bank are not privileged under the legal advice head but beyond this the scope of legal advice privilege is controversial.
Bank accepts that it cannot rely on litigation privilege as opposed to legal advice privilege is that in Re L [1997] 1 AC 16 the House of Lords decided that litigation privilege is essentially a creature of adversarial proceedings and thus cannot exist in the context of non-adversarial proceedings. The Bank further accepts that the Bingham inquiry was not adversarial; the terms of reference were:-
"To enquire into the supervision of BCCI under the
The inquiry was set up on behalf of the Chancellor of the Exchequer and the Bank but was a private non-statutory inquiry. As the judge said:-
"It was an inquiry one outcome of which could be criticism of the conduct of the
Nevertheless the inquiry did not constitute adversarial litigation and litigation privilege cannot arise. To the extent that the Bank now wish to claim privilege in the current litigation, the Bank accept that they can only claim legal advice privilege.
Bank of England appointed 3 Bank officials, Mr Paul Tucker, Mr John Trundle and Mr John Rippon to deal with all communications between the Bank and the inquiry. They became known as the Bingham Inquiry Unit ("BIU"). On the day on which they were appointed they met the Bank's solicitors, Freshfields. All the BIU's communications with the inquiry were therefore the subject of extensive legal advice from Freshfields and counsel instructed by them. This advice covered all aspects of the preparation and presentation of the Bank's evidence and submissions to the Bingham inquiry. The Bank and its solicitors prepared a substantial 258 page document which constituted its "Statement to the Inquiry"; they also prepared a paper entitled "Supervisory Issues". Lord Justice Bingham was not provided with witness statements but witnesses gave evidence to him and that evidence was transcribed. The Bank has disclosed both of its submissions in the form in which they were finally sent to Lord Justice Bingham and the transcripts of the evidence of its witnesses.
vice versa, nor is disclosure sought of any of Freshfields' internal memoranda or drafts. He accepts that the BIU was, for the purpose of the inquiry, the client of Freshfields and that communications passing between them are covered by legal advice privilege. But he submits that documents prepared by the Bank's employees or ex-employees, whether prepared for submission to or at the direction of Freshfields or not, should be disclosed as being no more than raw material on which the BIU would, thereafter, seek advice. The evidence isolated and the judge dealt with 4 separate categories of such documents; he asked himself the following questions:-
(1) Does legal advice privilege extend to documents prepared by
(2) Does it extend to documents prepared by
(3) Does it extend to documents prepared by
(4) Are the answers to (1), (2) and (3) above any different if the documents were prepared by
It is accepted that some, at any rate, of the material sought could be highly relevant to the litigation eg, the first memorandum or statement of an officer intimately concerned in the supervision of BCCI.
Bank was :-
"an internal confidential document, not being a communication with a third party, which was produced or brought into existence with the dominant purpose that it or its contents be used to obtain legal advice is privileged from production".
It will be necessary to consider the nineteenth century authorities to see whether this is right.
Lawyer and client privilege is of great antiquity. In the early nineteenth century there was controversy whether the privilege only existed in relation to existing litigation. This debate was regarded as authoritatively settled by Lord Brougham LC, sitting on appeal, in Greenough v Gaskell (1833) 1 My. & K. 98 in which the question arose whether the defendant solicitor, sued for fraudulently concealing that his client was insolvent and thereby inducing the plaintiff to issue a promissory note on the client's behalf, could claim privilege in respect of communications which he had received from his client. The Lord Chancellor held that the defendant could claim privilege, that it made no difference whether it was the client or the solicitor who was the defendant and that it did not matter that, at the time, there were no existing or contemplated proceedings. Since this is the first time that legal advice privilege, in the absence of pending or contemplated litigation, was unequivocally upheld, it is necessary to quote a fairly lengthy passage from the judgment (pages 101-103):-
"Here the question relates to the solicitor, who is called upon to produce the entries he had made in accounts, and letters received by him, and those written (chiefly to his town agent) by him, or by his direction, in his character or situation of confidential solicitor to the party; and I am of opinion that he cannot be compelled to disclose papers delivered, or communications made to him, or letters, or entries made by him in that capacity. To compel a party himself to answer upon oath, even as to his belief or his thoughts, is one thing; nay, to compel him to disclose what he has written or spoken to others, not being his professional advisers, is competent to the party seeking the discovery; for such communications are not necessary to the conduct of judicial business, and the defence or prosecution of men's rights by the aid of skilful persons. To force from the party himself the production of communications made by him to professional men seems inconsistent with the possibility of an ignorant man safely resorting to professional advice, and can only be justified if the authority of decided cases warrants it. But no authority sanctions the much wider
As regards them, it does not appear that the protection is qualified by any reference to proceedings pending or in contemplation. If touching matters that come within the ordinary scope of professional employment, they receive a communication in their professional capacity, either from a client, or on his account, and for his benefit in the transaction of his business, or, which amounts to the same thing, if they commit to paper, in the course of their employment on his behalf, matters which they know only through their professional relations to the client, they are not only justified in withholding such matters, but bound to withhold them, and will not be compelled to disclose the information or produce the papers in any Court of law or equity, either as party or as witness. If this protection were confined to cases where proceedings had commenced, the rule would exclude the most confidential, and it may be the most important of all communications – those made with a
If it were confined to proceedings begun or in contemplation, then every communication would be unprotected which a party makes with a
The foundation of this rule is not difficult to discover. It is not (as has sometimes been said) on account of any particular importance which the law attributes to the business of legal professors, or any particular disposition to afford them protection, though certainly it may not be
But it is out of regard to the interests of justice, which cannot be upholden, and to the administration of justice, which cannot go on, without the aid of men skilled in jurisprudence, in the practice of the Courts, and in those matters affecting rights and obligations which form the subject of all judicial proceedings. If the privilege did not exist at all, every one would be thrown upon his own legal resources; deprived of all professional assistance, a man would not
It is apparent from this lengthy extract that the privilege stemmed from the confidential relationship of client and solicitor and attached only to communications between the client and solicitor. It is also true to say that at this early stage in the law there was no distinction drawn between litigation privilege and legal advice privilege; the Lord Chancellor thought there was a single lawyer/client privilege which applied even if proceedings were not contemplated. However, the reference to the competence of the party seeking discovery to compel the other party
"to disclose what he has written or spoken to others, not being his professional advisers" (at the beginning of the quotation)
militates against the submission that the client's internal memoranda or materials preparatory to consulting his solicitor can be privileged.
". . . I must refuse so much of the motion [for production] as relates to the documents alleged to be privileged; I have anxiously examined the subject, and arrived at a conclusion, which to me has seemed right; but it has not been approved, and I have no doubt, that, if I were to order the production of these documents, the order would be reversed elsewhere.
The unrestricted communication between parties and their professional advisers, has been considered to be of such importance as to make it advisable to protect it even by the concealment of matter without the discovery of which the truth of the case cannot be ascertained." Reece
We note again the use of the phrase "communication between parties and their professional advisers".
three important cases in the Court of Appeal decided between 1876 and 1881 of which the first is Anderson v Bank of British Columbia (1876) 2 ChD 644. Litigation was threatened against an English bank concerning the conduct of an account kept at the branch of the bank in Oregon. The English bank's London manager thought it necessary to ascertain the full facts and cabled the branch manager in Oregon (Mr Russell) for full particulars of transactions on the account. Mr Russell replied with the particulars and in the ensuing litigation the bank claimed that the reply was privileged. As Bingham LJ pointed out in Ventouris v Mountain [1991] 1 WLR 607, 612H, a modern court would be likely to have held that privilege did attach since litigation was imminent and the letter was written for the purpose of obtaining advice in that litigation. But at this stage there was no clear-cut distinction between litigation and legal advice privilege and both Sir George Jessel MR at first instance and the Court of Appeal thought it plain that Mr Russell's letter was not privileged; this was mainly because they concluded that the bank's London manager was taking steps to inform himself of the position rather than to obtain material which would find its way, in due course, into counsel's brief. Once again, in the light of the arguments addressed to us, it is unfortunately necessary to set out substantial parts of the judgments. Mr Stadlen relied in particular on the first citation from the judgment of Sir George Jessel MR. Mr Pollock relied on the judgments in the Court of Appeal.
"The affidavit goes on to state this, that when he first saw the letter of the Plaintiff he observed - whatever "observed" may mean - "that litigation was imminent, and I felt it was essential that the
This, said Mr Stadlen, showed that any communication made or sent for the purpose of being laid before a solicitor was privileged. The Master of the Rolls then, after referring to authority, including Greenough v Gaskell, set out the object of the rule (page 649):-
"The object and meaning of the rule is this: that as, by reason of the complexity and difficulty of our law, litigation can only be properly conducted by professional men, it is absolutely necessary that a man, in order to prosecute his rights or to defend himself from an improper claim, should have recourse to the assistance of professional lawyers, and it being so absolutely necessary, it is equally necessary, to use a
Next, the Master of the Rolls set out the extent of the rule (pages 649-650):-
"Now, as to the extent of the rule. It goes not merely to a communication made to the professional agent himself by the client directly, it goes to all communications made by the client to the solicitor through intermediate agents, and he is not bound to write letters through the post, or to go himself personally to see the solicitor; he may employ a third person to write the letter, or he may send the letters through a messenger, or he may give a
Again, the solicitor's acts must be protected for the use of the client. The solicitor requires further information, and says, I will obtain it from a third person. That is confidential. It is obtained by him as solicitor for the purpose of the litigation, and it must be protected upon the same ground, otherwise it would be dangerous, if not impossible, to employ a solicitor. You cannot ask him what the information he obtained was. It may be information simply for the purpose of knowing whether he ought to defend or prosecute the action, but it may be also obtained in the shape of collecting evidence for the purpose of such prosecution or defence. All that, therefore, is privileged.
Then the rule goes a step further. The solicitor is not bound any more than the client to do this work himself. He is not bound either to collect information or to collect testimony. He may employ his clerks or other agents to do it for him, and upon the same principle as the information acquired by himself directly is protected, so the information acquired by a clerk or agent employed by him is equally protected. But then the cases go still a step further. Suppose the information required is in a foreign country, where neither the solicitor nor his clerk nor an ordinary agent can obtain it, he may request the client to obtain it himself, and then the information so obtained by the client at the request or under the advice of the solicitor is in a sense obtained by the agent of the solicitor, although it is a
While the first passage that has been quoted, and on which Mr Stadlen relies, is in general terms, the sentences that we have emphasised in the later passages make it plain that the foundation of his approach was the existence or imminence of litigation.
bank, claiming that Mr Russell's letter was privileged, opened his argument by saying (page 654):-
"We contend that this letter is privileged as being a confidential communication to enable the directors to obtain legal advice."
Mellish LJ intervened:-
"I apprehend that a letter written by an agent who was getting up evidence to be used at the trial would be privileged; but this is not like that."
He intervened again at the end of the argument to say:-
"The object here was, not to obtain evidence, but to learn what the facts were, in order to know whether the claim should be resisted. It seems to be an extension of the rule as to privileged communications to apply it to such a case."
"Looking at the dicta and the judgments cited, they might require to be fully considered, but I think they may possibly all be based upon this, which is an intelligible principle, that as you have no right to see your adversary's brief, you have no right to see that which comes into existence merely as the materials for the brief. But that seems to me to have no application whatever to a communication between a principal and his agent in the matter of the agency, giving information of the facts and circumstances of the
There are two relevant passages from the judgment of Mellish LJ; first, at page 658:-
"I am clearly of opinion that such a communication is not privileged. To be privileged it must come within one of two classes of privilege, namely, that a man is not bound to disclose confidential communications made between him and his solicitor, directly, or through an agent who is to communicate them to the solicitor; or, secondly, that he is not bound to communicate evidence which he has obtained for the purpose of litigation."
This appears to be the first occasion on which a clear distinction is drawn between legal advice privilege and litigation privilege; although many claims to privilege can be decided on either basis, it is a distinction which appears hereafter in the decided cases.
". . . but I cannot think that that ought to be held to apply to information which a principal asks his agent to give respecting the matters which the agent has done for and on account of the principal. That is information respecting matters which in point of law are the acts of the principal himself, and it is information respecting matters as to which the knowledge of the agent is the knowledge of the principal. In point of law, the principal is to be deemed to have known the facts before he has actually got personal information about them. I cannot but think that, as you are entitled to ask the principal what he knows respecting those facts, you must necessarily be entitled to the information which his agent has sent respecting them."
Baggallay JA was of the same opinion and said (pages 661-2):-
"Now if the Defendant in this case, instead of being a
These two citations show that information given by an employee to an employer or fellow-employee, or information given by an agent to a principal, stands in the same condition as matters known to the client and does not, of itself, attract privilege in the first of Mellish LJ's two categories. This is so even though, on the facts, it is intended that it be shown to a solicitor. If, however, it is intended that the information will be shown to a solicitor in the context of existing or contemplated litigation, it will fall into the second category, whether it was obtained for use as evidence or for the purpose of obtaining advice. The Anderson case thus does not support the wide ambit of privilege for which Mr Stadlen contends.
Vauxhall Water Company v Quick (1878) 3 QBD 315. The water company sued its former engineer; before the action was brought but when it was contemplated, certain documents were prepared to be laid before the company's solicitor for his advice, although in the event one of them (a transcript, made by a shorthand writer of a conversation between a chimney sweep employed by the company and the company's current engineer) was not in fact put before the solicitor. Cockburn CJ presiding in the Queen's Bench Division said (pages 317-8):-
"The relation between the client and his professional legal adviser is a confidential relation of such a nature that to my mind the maintenance of the privilege with regard to it is essential to the interests of justice and the well-being of society. Though it might occasionally happen that the removal of the privilege would assist in the elucidation of matters in dispute, I do not think that this occasional benefit justifies us in incurring the attendant risk. The question here is whether the documents of which inspection is sought are within the privilege. I think they are. It is clear that they were documents containing information which had been obtained by the plaintiffs with a
In the Court of Appeal Brett LJ, after referring to what had been said by James and Mellish LJJ in Anderson, said this:-
". . . it is clear that if a party seeks to inspect a document which comes into existence merely as the materials for the brief, or that which is equivalent to the brief, then the document cannot be seen, for it is privileged. It has been urged that the materials, or the information obtained for the brief, should have been obtained "at the instance" or "at the request" of the solicitor; but I think it is enough if they come into existence merely as the materials for the brief, and I think that phrase may be enlarged into "merely for the purpose of being laid before the solicitor for his advice or for his consideration." If this is the correct rule, the only question is whether the affidavits in the present case bring the documents under discussion within that rule. I think all the classes of documents mentioned are brought within the rule. The only document about which there can be any doubt is the transcript of the shorthand writer's note of the conversation between the chimneysweep and the company's engineer; but I think that the Queen's Bench Division construed the language of the affidavit to mean that the transcript was made in order that it might be furnished to the solicitor for his advice, although before passing on to him, it was to be laid before the board of directors, or reported to the board, in order than they also might see it. The object for which the notes were taken, and the transcript made, was that they might be furnished to the solicitor for his advice. If that is so, then it stands on the same footing as the others, except that it was not sent to the solicitor; that cannot make any difference. If at the time the document is brought into existence its purpose is that it should be laid before the solicitor, if that purpose is true and clearly appears upon the affidavit, it is not taken out of the privilege merely because afterwards it was not laid before the solicitor. It might not have been laid before the solicitor, because the person making the statement had died or went away and could not be found. I think, therefore, that this document having been made bonâ fide merely for the purpose of being laid before the solicitor for his advice or his consideration, it is precisely like the other documents, and that all the documents are privileged. "
Mr Stadlen submitted that these passages from the judgments of Cockburn CJ and Brett LJ showed that, if documents were prepared the contents of which were to be made known to a solicitor for the purpose of his giving advice, it did not matter that they were not submitted to him. It followed that, even the documents in category (2) set out in paragraph 4 above were privileged. However that does not address the question whether memoranda or documents, produced to the Bingham Inquiry Unit by Bank employees, are, in general, privileged at all. That question is not settled by these citations; it is fair to say that the judgment of Cockburn CJ is in general terms which might arguably encompass legal advice privilege as well as litigation privilege but it is quite clear that the "rule" identified and addressed by Brett LJ is the rule relating to litigation privilege and that he is not talking of legal advice privilege in any way.
"Privilege only extends to communications with legal advisers, or in some way connected with legal advisers; communications with a most confidential agent are not protected if that confidential agent happens not to be a solicitor. And this proceeds on the principle that laymen (by which I mean persons not learned in the law) cannot be expected to conduct their defence or litigation without the assistance of professional advisers; and, for the purpose of having the litigation conducted properly, the law has said that communications between the client and the solicitor shall be privileged, and that no one shall be entitled to call for the production of a document which has been submitted to the solicitor for the purpose of obtaining his advice, or for the purpose of enabling him to institute or to defend proceedings. There must be the freest possible communication between solicitor and client, and it is on this ground that professional communications are entitled to privilege, which excepts them from the general rule. The most obvious form of claiming privilege is when any litigant sends either directly or indirectly to his solicitor a document for the purpose of obtaining his advice, or for the purpose of enabling him to institute or defend an action. That is not quite the question here . . ."
and (pages 322-3):-
"That, I think, is the true principle, that if a document comes into existence for the purpose of being communicated to the solicitor with the object of obtaining his advice, or of enabling him either to prosecute or defend an action, then it is privileged, because it is something done for the purpose of serving as a communication between the client and the solicitor."
He pointed to the disjunctive preposition "or" in both citations and submitted that Cotton LJ had the two quite separate categories of privilege in mind and that, for the purpose of each of them, it was sufficient that the document be prepared with the dominant purpose that it or its contents should be put before the solicitor for advice. This, however, reads too much into the word "or" when the context was solely that of litigation privilege. The "obtaining of the advice" is in contrast to "the purpose of the solicitor being enabled to institute or defend an action" and the advice contemplated by Cotton LJ is advice in relation to the intended action. That is made clear by the passage towards the end of his judgment (at page 323):-
"All these documents must be looked upon as having been prepared for the purpose of being laid before the solicitor, either for the purpose of enabling him to prosecute the action contemplated, or for the purpose of obtaining his advice on the question at issue in the action, and in my opinion are privileged"
It is clear from this final citation that Cotton LJ was only talking in terms of litigation privilege.
three cases is Wheeler v Le Marchant (1881) 17 ChD 675 which was a case of legal advice privilege not litigation privilege. In that context it was held that documents obtained from a third party to be shown to a solicitor for his advice did not fall within the privilege. Advice was given to the defendant trustee of the will of a Mr Brett in the course of its administration in the Chancery Division; for the purpose of that advice information was sought from both the former and the current estate-agent and surveyor. Part of the estate consisted of land in respect of which the defendant made an agreement with Mr Wheeler that he (Mr Wheeler) was to erect certain buildings and then be granted a lease of that land. The parties fell out. Mr Wheeler brought an action for specific performance and the defendant trustee claimed privilege for the reports of the estate-agent/surveyor made to the solicitors in the course of the administration of the estate. It was held that while the communications between the defendant and the estate's solicitors were privileged, the reports of the estate-agent/surveyor were not. Cotton LJ is reported to have intervened in argument at page 680 to say:-
"Your proposition is that all communications by a solicitor with third parties, for the purpose of enabling him to give advice, are privileged. Has any case protected them except when made post litem motam?"
Counsel responded, after a little prevarication:-
"The question is whether the rule, though not distinctly carried to such a length by any of the cases, ought not to be extended to meet this case . . ."
"As regards the main question in dispute, this appears to be an attempt on the part of the present Respondents to extend the rule as to protection from discovery. It was fairly admitted by their counsel that no decided case carries the rule to the extent to which they wish it carried, but they urged that as a matter of principle it ought to be so extended. What they contended for was that documents communicated to the solicitors of the Defendants by third parties, though not communicated by such third parties as agents of the clients seeking advice, should be protected, because those documents contained information required or asked for by the solicitors, for the purpose of enabling them the better to advise the clients. The cases, no doubt, establish that such documents are protected where they have come into existence after litigation commenced or in contemplation, and when they have been made with a
And (pages 681-2):-
". . . it must not be supposed that there is any principle which says that every confidential communication which it is necessary to make in order to carry on the ordinary business of life is protected. The protection is of a
And (pages 682-3):-
"But what we are asked to protect here is this. The solicitor, being consulted in a matter as to which no dispute has arisen, thinks he would like to know some further facts before giving his advice, and applies to a surveyor to tell him what the state of a given property is, and it is said that the information given ought to be protected because it is desired or required by the solicitor in order to enable him the better to give legal advice. It appears to me that to give such protection would not only extend the rule beyond what has been previously laid down, but beyond what necessity warrants. The idea that documents like these require protection has been started, if I may say so, for the first time to-day, and I think the best proof that the necessities of mankind have not been supposed to require this protection is that it has never heretofore been asked. It seems to me we ought not to carry the rule any further than it has been carried. It is a rule established and maintained solely for the purpose of enabling a man to obtain legal advice with safety. That rule does not, in my opinion, require to be carried further, and there fore I think this appeal ought to be allowed . . ."
Brett LJ said (page 683):-
"The proposition laid before us for approval is, that where one of the parties to an action has in his possession or control documents which passed between his solicitor and third parties, they are protected in his hands from inspection, on the ground that they were documents which passed between the solicitor and the third party for the purpose of enabling the solicitor to give legal advice to his client, although such information was obtained by the solicitor for that purpose at a time when there was no litigation pending between the parties, nor any litigation contemplated. It seems to me that that proposition cannot be acceded to. It is beyond any rule which has ever been laid down by the Court, and it seems to me that it is beyond the principles of the rules which have been laid down. The rule as to the non-production of communications between solicitor and client is a rule which has been established upon grounds of general or public policy. It is confined entirely to communications which take place for the purpose of obtaining legal advice from professional persons. It is so confined in terms, it seems to me it is so confined in principle, and it does not extend to the suggested case."
Cotton LJ said (pages 684-5):-
"It is said that as communications between a client and his legal advisers for the purpose of obtaining legal advice are privileged, therefore any communication between the representatives of the client and the solicitor must be also privileged. That is a fallacious use of the word "representatives." If the representative is a person employed as an agent on the part of the client to obtain the legal advice of the solicitor, of course he stands in exactly the same position as the client as regards protection, and his communications with the solicitor stand in the same position as the communications of his principal with the solicitor. But these persons were not representatives in that sense. They were representatives in this sense, that they were employed on behalf of the clients, the Defendants, to do certain work, but that work was not the communicating with the solicitor to obtain legal advice. So their communications cannot be protected on the ground that they are communications between the client by his representatives and the solicitor. In fact, the contention of the Respondents comes to this, that all communications between a solicitor and a third person in the course of his advising his client are to be protected. It was conceded there was no case that went that length, and the question is whether, in order fully to develop the principle with all its reasonable consequences, we ought to protect such documents. Hitherto such communications have only been protected when they have been in contemplation of some litigation, or for the purpose of giving advice or obtaining evidence with reference to it. And that is reasonable, because then the solicitor is preparing for the defence or for bringing the action, and all communications he makes for that purpose, and the communications made to him for the purpose of giving him the information, are, in fact, the brief in the action, and ought to be protected. But here we are asked to extend the principle to a
Here Cotton LJ, unlike in his judgment in Southwark v Quick, considers each of the two categories of legal professional privilege and decides in terms that the documents in question do not fall within the first category because they are not communications between solicitor and client and not within the second category because litigation is not contemplated. This case thus makes clear that legal advice privilege does not extend to documents obtained from third parties to be shown to a solicitor for advice. Mr Stadlen, of course, accepts this but says that communications from an employee are different. The reason he gives is that a corporation can only act through its employees; while that is true, it is not a consideration that can carry Mr Stadlen home. Indeed the passage cited from Anderson shows that information from an employee stands in the same position as information from an independent agent. It may, moreover, be a mere matter of chance whether a solicitor, in a legal advice privilege case, gets his information from an employee or an agent or other third party. It may also be problematical, in some cases, to decide whether any given individual is an employee or an agent and undesirable that the presence or absence of privilege should depend upon the answer.
(1) Sir George Jessel MR in Anderson
(2) Lord Langdale MR in Reece
(3) Cockburn CJ in Southwark and
(4) Sir George Jessel MR in Wheeler
(5) Turner
He then made his detailed exposition of the law by reference first to communication between client and adviser in sections I to IX of Part II of the relevant chapter and then, secondly, by reference to documents and oral communications having reference to (or connection with) existing or anticipated litigation in section X of the chapter
"not being communications directly between the client and the professional legal adviser, or communication or documents standing on the same footing."
v Hammer [1981] 1 QB 223, 243F-244A per Lord Denning MR and Halsbury, Laws, 4th ed. Vol 37 (2001) para 579:-
"Reports made by agents or employees to employer. Reports made by employees to their employers or by agents to their principals are not privileged unless they satisfy, and are privileged if they do satisfy, the conditions already set out, that is to say they must be reports made for the purpose of being laid before the party's legal adviser for the purpose of obtaining his advice in connection with the anticipated or pending litigation."
Mr Stadlen submitted that, even if the law was as stated in the nineteenth century, it had been elaborated by developments in the law of discovery which occurred in the twentieth century. Thus there was a lengthy debate in the context of litigation privilege in relation to the right test to apply to a document intended to be submitted to a solicitor for his consideration. Was it sufficient that one of the purposes for which it had been prepared was to obtain legal advice or did it have to be the dominant purpose or even the sole purpose of the document coming into existence? In Grant v Downs (1976) 135 CLR 674 the majority of the High Court of Australia said it had to be the sole purpose; Barwick CJ's dissenting judgment in favour of the dominant purpose was ultimately preferred by the House of Lords in Waugh v British Railways Board [1980] AC 521 and in Esso Australia v Federal Commissioner of Taxation (1999) HCA 67 the English test has now been adopted by the High Court of Australia in preference to its original view. Mr Stadlen placed particular reliance on the statements of principle in the judgment of Barwick CJ at page 677 which was ultimately adopted by the House of Lords in Waugh. It is in the following terms:-
"Having considered the decisions, the writings and the
"On its natural reading this passage would seem to be concerned both with the obtaining of legal advice and with the conduct of litigation reasonably in prospect. It is possible that Sir Garfield had in mind only the obtaining of advice in relation to litigation in reasonable prospect, as opposed to the obtaining of legal advice which was not similarly focussed, but I can see no rational basis on which the principles which protect the confidentiality of the process of obtaining legal advice should differ as between these two distinct situations, although the exigencies of litigation, actual or contemplated, require the net to be cast wider than it is in relation to the obtaining of legal advice simpliciter, so as to enable a party to carry out confidential preparations for trial."
The judge further pointed out in paragraph 26 of his judgment that the passage in the judgment of Barwick CJ was expressly approved by Lords Wilberforce, Simon and Edmund-Davies in Waugh at pages 532-3, 534 and 537 and 543-4 respectively. It was this approval that, together with two authorities in relation to litigation privilege and Balabel v Air India [1988] Ch 317 which undoubtedly concerned legal advice privilege, persuaded the judge to accord the disputed documents the privilege claimed by the Bank.
"using it or its contents in order to obtain legal advice or to conduct or aid the conduct of litigation"
it is more natural to read the words "in order to obtain legal advice" not as referring to the obtaining of legal advice in a free-standing situation but as a contrast with the concept "in order to conduct, or aid in the conduct of, litigation". In other words, the use of the document envisaged by the Chief Justice is potentially a two-fold use viz. for obtaining advice in the pending litigation or for conducting (or helping to conduct) the pending litigation. So understood it is a complete statement of the relevant law. If it is to be more widely understood, the statement of the law is incomplete, unless it was intended to depart from Wheeler v Le Marchant and the law as understood at the end of the nineteenth century. There is no indication of that.
"Where a report is brought into existence for several reasons or purposes only one of which is to obtain professional legal advice in litigation that is pending or anticipated, is it protected by legal professional privilege from discovery?"
This is echoed at both the beginning and conclusion of Lord Wilberforce's speech at pages 531E and 533B respectively:-
". . . . the affidavit [of the defendant] makes it clear that the report was prepared for a dual purpose: for what may be called railway operation and safety purposes and for the purpose of obtaining legal advice in anticipation of litigation . . . . So the question arises whether this is enough to support a claim of privilege . . ."
and
"It appears to me that unless the purpose of submission to the legal adviser in
Lord Simon of Glaisdale's speech is to similar effect at pages 536A-B (where he cites Cotton LJ's judgment in Southwark v Quick as being a case of pending or anticipated litigation) and 538A. Lord Edmund-Davies at pages 541G-542C expressly draws attention to the distinction between the two categories of legal professional privilege and makes it clear that the case with which the House was dealing was privilege in aid of existing or contemplated litigation. He then cites Anderson v Bank of British Columbia, sets out the possible candidates for the appropriate test in relation to a document prepared for use in such litigation and states that the House of Lords was free to choose and declare the proper test. He continues (page 543C):-
". . . . in my judgment we should start from the basis that the public interest is, on balance, best served by rigidly confining within narrow limits the cases where material relevant to litigation may be lawfully withheld. Justice is better served by candour than by suppression. For, as it was put in the Grant
He then comes down in favour of Barwick CJ's "dominant purpose" and quotes in full the passage set out in paragraph 22 above. But the context is all litigation privilege and it is clear that he was not considering legal advice privilege. If he had been considering legal advice privilege, it is unlikely, in the light of the considerations advanced in the above passage, that Lord Edmund-Davies would have wished to extend legal advice privilege in any way.
(1) the need for a client
"to be able to make a clean breast of it to the gentleman whom he consults with a
(to use the words of Sir George Jessel MR in Anderson) is paramount when litigation either exists or is contemplated. It is in the interests of the state which provides the court system and its judges at taxpayers' expense that legal advisers should be able to encourage strong cases and discourage weak cases, see
(2) one ought not to lose sight of the public interest that the courts, if possible, should come to correct judgments on the basis of all relevant material. Of course legal advice privilege must prevail over this consideration to the appropriate extent. It is a fundamental human right which can be overridden only by the express words of a statute or by necessary implication, see R (Morgan Grenfell & Co Ltd)
v BCCI Holdings (Luxembourg) SA (1992) BCLC 583 where a claim for legal advice privilege was rejected for reports written by accountants both when the accountants were independent and when they reconstituted themselves as a committee of the client.
v Fitzroy Robinson Partnership [1987] 1 WLR 1027 and The Sagheera [1997] 1 Lloyds Rep 160 (both cases of litigation privilege) were prepared to proceed on the basis that any document prepared with the dominant purpose of using it or its contents to obtain legal advice was privileged. In defining the extent of the privilege in the latter case, Rix J said that the dominant purpose test applies in relation to legal advice privilege in a different way from the way it applies in relation to litigation privilege and added:-
"In legal advice privilege, I would suggest, the practical emphasis is upon the purpose of the retainer. If the dominant purpose of the retainer is the obtaining and giving of legal advice, then, although it is in theory possible that individual documents may fall outside that purpose, in practice it is unlikely."
This observation was not critical to his judgment and we would respectfully doubt whether the shift of focus from the dominant purpose for which a document or documents were prepared to the "dominant purpose of the retainer" can be justified by reference to authority or principle in relation to documents which are not communications between client and legal adviser.
v Air India [1988] Ch 317 is potentially more relevant since it is a case which relates to legal advice privilege. The issue was whether, once a solicitor had been instructed, legal advice privilege extended to all communications between solicitor and client on matters within the ordinary business of the solicitor and referable to the relationship or whether, although communications seeking or conveying advice were privileged, documents passing between the client and his solicitor recording information or transactions or meetings were not privileged. This court decided that the former was the law; the appellants' position in this case is, in no way, inconsistent with the decision since they accept that all documents passing between the BIU and Freshfields are privileged as, indeed, are Freshfields' own drafts and memoranda. The issue in Balabel arose in an action brought by Mr and Mrs Balabel for specific performance of an agreement for an underlease, supposedly made between them and Air India as underlessors; unfortunately for Mr and Mrs Balabel there was no note or memorandum in writing passing between the parties for the purpose of section 40 of the Law of Property Act 1925 and they made a discovery application in the hope that such a memorandum would be found in
(1) communications between Air India and their solicitors other than those seeking or giving legal advice;
(2) drafts, working papers and memoranda of the solicitors;
(3) internal communications of Air India other than those seeking legal advice.
Significantly Mr Lightman QC for the appellants, against whom an order for discovery had been made, abandoned any claim to privilege for category (3) which was the category equivalent to the category for which privilege is claimed in the present case, see page 319C of the report.
"Although originally confined to advice regarding litigation, the privilege was extended to non-litigious business. Nevertheless, despite that extension, the purpose and scope of the privilege is still to enable legal advice to be sought and given in confidence. In my judgment, therefore, the test is whether the communication or other document was made confidentially for the purposes of legal advice. Those purposes have to be construed broadly."
The judge drew attention to the words "or other document" but the context of that phrase was that privilege was being sought for (2) "draft, working papers and memoranda" which were not, of course, communications. No argument was addressed on class (3) which would be the only relevant class for the purpose of the argument in this case. Then the judge cited the passage at page 332:-
"As indicated, whether such documents are privileged or not must depend on whether they are part of that necessary exchange of information of which the object is the giving of legal advice as and when appropriate."
That is a perfectly appropriate test to apply to communications between the client and his solicitor but authority does not support its wider application to memoranda supplied by employees for the purpose of being sent to the client's solicitor and it is most unlikely that Taylor LJ intended to deal with that question. Indeed, shortly before the passage quoted, Taylor LJ pointed out that the range of assistance given by solicitors to their clients and of activities carried out on their behalf has been greatly broadened in recent times and is still developing. He added:-
"Hence the need to re-examine the scope of legal professional privilege and keep it within justifiable bounds."
Balabel is thus no authority for extending the privilege.
Bank is not entitled to privilege in any of the four categories itemised at the beginning of this judgment. Mr Stadlen asked what the position would be if the Governor himself had noted down what he remembered in relation to the supervision of BCCI with the intention of giving it to the BIU for transmission to Freshfields. No privilege has been claimed for any such specific document but, as it seems to us, Mr Pollock was right to say that on the evidence before the court, the BIU, which was established to deal with inquiries and to seek and receive Freshfields' advice, is for the purpose of this application, the client rather than any single officer however eminent he or she may be. It follows that no separate consideration need be given to the position of ex-employees who are, obviously, in no better position for the purpose of any claim to privilege.
In the light of the conclusions so far, it is unnecessary to express a view on the question whether the internal documentation of the Bank, which came into existence after the setting up of the Bingham inquiry, was indeed prepared with the dominant purpose of obtaining advice. It would, no doubt, be right to say that the obtaining and giving of advice was an important purpose; but we would not say on the facts of the present case that it was the dominant purpose. On any natural view of the matter the dominant purpose of obtaining the information which employees and ex-employees could give to the Bingham inquiry was merely to present that evidence to the inquiry. No doubt the Bank would naturally have been anxious to present that evidence in the way least likely to attract criticism. One of Freshfields' many skills is, of course, to present their clients' cases in the most favourable light. That, after all, is in large part the art of the advocate. Is this assistance "legal advice" in the sense in which the phrase is used when one refers to privilege being claimed for legal advice?
Bank compiled the 258 page Statement to the inquiry in November 1991 and the paper entitled "Supervisory Lessons" in April 1992. Witnesses needed to be prepared, although no formal statements were taken from the witnesses. It is not surprising to read that the BIU communications with the inquiry were the subject of extensive legal advice from Freshfields. Mr Croall of Freshfields put the matter in this way in paragraph 17 of his second witness statement:-
"So as to ensure that the
He later asserts that the documents passed to Freshfields were prepared with the dominant purpose of obtaining legal advice and that he has consulted with the writers of documents not passed to Freshfields to ascertain whether they were prepared with the same dominant purpose.
Bank, in these circumstances, relies on the following paragraph in the judgment of Taylor LJ in Balabel v Air India at page 330 D-G:-
"Although originally confined to advice regarding litigation, the privilege was extended to non-litigious business. Nevertheless, despite that extension, the purpose and scope of the privilege is still to enable legal advice to be sought and given in confidence. In my judgment, therefore, the test is whether the communication or other document was made confidentially for the purposes of legal advice. Those purposes have to be construed broadly. Privilege obviously attaches to a document conveying legal advice from solicitor to client and to a specific request from the client for such advice. But it does not follow that all other communications between them lack privilege. In most solicitor and client relationships, especially where a transaction involves protracted dealings, advice may be required [as] appropriate on matters great or small at
In applying this passage it seems to us that, on the facts of the present case, there may be a temporal distinction to be drawn between (1) original documentary material supplied by Bank employees to the BIU (or directly to Freshfields), whether obtained in response to a Freshfields inquiry or not, for the purpose of either the November 1991 submission or the April 1992 paper and (2) material supplied in "responses to requests from the Inquiry" to use Mr Croall's words at the end of his paragraph 17.
Bank could comply with its primary duty of putting all relevant factual material before Lord Justice Bingham. Mr Stadlen submitted that Mr Croall's assertion to the contrary must conclude the matter in the Bank's favour unless Mr Croall's honesty was to be impugned. We do not agree. The question of dominant purpose is a matter for a court to determine after consideration of the relevant evidence. If it can be seen upon analysis that the dominant purpose is not that of obtaining advice, as will seldom be the case where a national institution is gathering evidence to put before an inquiry set up by Government, then it is the court's duty to say so. The "continuum of communication . . . . as to what should prudently and sensibly be done in the relevant legal context" has not yet begun.
As stated, however, we do not, in any event, consider that privilege extends to any of the documentation or internal memoranda of the Bank's employees and, subject to any argument on the detailed wording, would be minded to grant the declaration for which the appellants asked in their application of 25th October 2002, on the assumption it is in the same form as recorded in paragraph 3.2 of Mr Grierson's 8th witness statement of 28th October 2002, and to order that the Bank serve a further and better list of documents in accordance with the terms of such declaration.
Order: Appeal allowed as per counsel's agreed order. Leave to appeal to the House of Lords refused. Order suspended pending result of Petition to appeal to their Lordships' House.
Thursday, 3rd April 2003
(10.15 am)
victory.
" ... the liquidator's belated attempt to substitute the word 'control' for the word 'possession' in the order."
Bank", which is what we suggest for clarity, and their attempt to substitute the word "control" for the word "possession" because what is at its heart is that in our submission it is abundantly plain, when one looks at the material, that the application concerned, and concerned only, documents within the Bank's files and not documents within Freshfields' files.
Bank to Freshfields. And vice versa, was not actually discussed but I would have thought it was implicit equally that, if Freshfields had sent a document directly to the Bank, that would have equally been in a category about which battle was not being fought. What was being fought was the documents that had been prepared on the Bank's side.
Bank. The debate did not in any way fasten on the status of documents that are in Freshfields' files rather than the Bank's files, and I can show your Lordships the references to that in the material.
Bank has not put in evidence, and did not before the judge below, put in evidence in relation to the status or ambit of documents in its own files because there was no issue in relation to that and there simply has been no evidence and no argument relating to that issue.
view might cover some documents in Freshfields' files, if it could be shown that they were in the control of the Bank, would, by a side wind and without argument and without evidence, be ordering by this court that certain documents about which there has been not even identification, let alone argument, are not privileged.
verbatim?
Volume 1 -- and this, I am afraid, has tripped us up before in this case because people forget that there is a new terminology -- the relevant test for discovery is control.
"Control ... "
Bank's, actual possession, they remain privileged. If they are not privileged, then it appears absurd that we should have to go back and ask Tomlinson J for a further order that they list documents which are in their control, in that they are physically in Freshfields' possession, but the Bank are entitled to have them and they are not privileged.
Bank and the BIU would have them, and the only question was whether they are privileged or not.
three possible scenarios, and they are as follows: firstly, the witness writes to the BIU, who writes to Freshfields and vice versa, in which case there will be documents in the Bank's possession; secondly, the witness writes directly to Freshfields -- and this was a point made by my learned friend in argument -- and copies are sent to the BIU or copies are not sent to the BIU.
Bank are entitled in the sense under 31.8 to control -- they are entitled to copies or entitled to possession -- then that is non-privileged material which ought to be listed and disclosed because it does not fall within the privileged range of your Lordships' judgment. This is the witness providing information to Freshfields not for the dominant purpose of legal advice and not a communication between client and solicitor.
Bank at some stage and the Bank would have copies, but at some stage some of that may not have been. That explains why, in part, my learned friend's desire to insert 'created by the Bank' is wrong in this case because that has never been part of what has been argued. Now, if you have a case where Freshfields create a statement and then provide a copy to the BIU, my friend is seeking to exclude that, but on your Lordships' judgment that is not privileged and there is no reason why that should be excluded.
Bank" for the reasons I have just given, but we would say that it is sensible to substitute "control" for "possession" because that is simply going to avoid the need for us to make a separate and additional application to Tomlinson J to apply your Lordships' judgment hereafter
verbatim except for substituting the word "control", because that is what the order plus our judgment gives you a right to?
very firmly -- and it made it much easier for us, of course, in grasping the points -- that you did not seek anything passing between the Bank and Freshfields and I think actually you said the vice versa, if my Lord --
vis a vis the sheet anchor, that direct communications between a witness and a solicitor are not privileged. They are not privileged. Now, in order to get hold of those, of course, you have to ask yourself in whose possession or control are they for the purpose of seeking an order.
Bank because it was created at their behest and it is not privileged, then we can ask for discovery of it. Alternatively, Freshfields passed a copy to their client, which one would think would be sensible, in which case we would say we are entitled to a copy of that document from the Bank because it was never privileged. Now, it is not actually a communication from Freshfields. This is the problem. That is not a communication from Freshfields to the Bank; it is simply Freshfields passing on a copy of Mr Cooke's statement. So that is where the difficulty arises.
Bank, then Tomlinson J will have to work it out afterwards. What I am particularly concerned about is that you do not put in "created by the Bank" because that introduces a limitation which was not there before and which has not been the subject of argument and which, for the reasons I have explained to your Lordship, would be designed to exclude from discovery that which in fact in many cases ought to be given.
Bank and which would not form part of any argument that was addressed to your Lordship's court, and it is a matter of great importance that, whatever else your Lordships do, you do not make an order which has the effect of declaring what the law is in respect of material where there has been no argument addressed. And it looks as though I should draw your Lordships' attention to some of the references, because there is absolutely no doubt, whatever assumptions my learned friend may have made, that the argument, both below and in front of your Lordships' court, did not extend to documents created by Freshfields, and, my Lord, the starting --
Bank, one has:
"It is declared that the only documents or parts of documents created or coming into the Bank's possession ..."
Bank" in in response to an indication from the other side that they were asking for something that went wider than communication of documents in the Bank's files because it has never occurred to us, or indeed to Tomlinson J, or indeed to your Lordships -- because it is clear in paragraph 4 of the judgment, where you record my learned friend's concession that the application does not concern:
"Disclosure is not sought of any of Freshfields' internal memoranda or drafts."
Bank, and that category, it was said, was no longer live in the Court of Appeal and your Lordships said that it was only category 3 that was relevant to the application in your Lordships' court. Perhaps I should just refer your Lordships to paragraph 29 of the judgment. It is at page 35. The first reference is at page 34, six lines down:
"This court decided that –"
"This court decided that the former was the law. The appellant's position in this case is in no way inconsistent with the decision, since they accept that all documents passing between the BIU and Freshfields are privileged, as indeed are Freshfields' own drafts and memoranda."
Bank or to the witness -- the witness for approval -- then, although prepared by Freshfields, it is no longer internal.
Bank" or including the words "control" rather than "possession" would cover internal memoranda.
Bank, it would be disclosable, even if Freshfields had not sent it to anybody.
three categories that my learned friend has identified; we are simply seeking to preserve the status quo and the only way in which the status quo can be preserved, is to make it plain that this order is limited to the matters that were debated before your Lordship's court and that does not include documents created by Freshfields.
Bank's possession and leave no declaration at all in relation to documents that may be somewhere else, because there has not been argument about documents that are somewhere else.
Bank's possession that were sent to the Bank by Freshfields, but I do not see that we can make a declaration of law that is inconsistent with our judgment so far as those documents are concerned simply because there has not been any argument about them. Do you see what I mean?
"It is declared that the only documents or parts of documents coming into the Bank's possession between the ... "
" ... which the Bank is entitled to withhold from inspection are ... "
that means that the declaration of law we are making focuses only on documents in your client's possession. It leaves open the question what about documents that Freshfields --
very uneasy.
very clear task in listing the documents.
very significant nature of your Lordships' decision. In the light of your Lordships' ruling on the interpretation of Waugh it would be the first time that legal advice privilege has been before their Lordships' house, because your Lordships have ruled that Waugh was confined to litigation privilege.
very wide ambit. First of all, your Lordships know, and indeed indicate in the judgment itself, that on the very question of the interpretation of Waugh there is a line of authority that is to contrary effect. There is the decision, unanimous decision, of the Court of Appeal in Guinness Peat, in which, as your Lordships say in the judgment, the court was prepared to proceed on the basis that any document prepared with the dominant purpose of using it or its contents to obtain legal advice was privileged, and, as made clear in that decision, the court itself interpreted the Waugh decision as applying the dominant purpose test to legal advice as well as litigation privilege. That was what Rix J held. It is also the interpretation of -- Barwick CJ's dictum which was approved in the House of Lords, which has been made clear by the High Court itself in the Esso case.
v Downs decision, as applying not just to litigation privilege but to legal advice privilege. So there is no doubt that in Australia, not just in statute, but in common law, the Bank's view, Tomlinson J' view, is the view that has prevailed and was the interpretation of the Barwick test. One --
very, very small amount of material. And of course, if your Lordships gave permission to appeal, it would be on terms that we would undertake to prepare the material so that, if the appeal failed, it would be immediately available to be disclosed.
view, if your Lordships were to give permission conditional upon it being expedited by their Lordship's house -- there are two quite separate questions here. One is, absent the possibility of it causing a delay in this case, is this a matter that ought to go to their Lordship's house and if your Lordships take the view that it is, then in our submission it would be right that your Lordships should give that indication even if your Lordships are concerned about the delay point, and it would be unfortunate, if your Lordships are of the view that this case does have sufficiently wide implications to justify a journey to the Lords, that you do not say so.
very wide ramifications. The second is in the context of inquiries, but the first has nothing to do with inquiries and really goes much, much wider, and it is important that one does not lose sight of that because, although in this case it is, of course, true that the dominant purpose test falls to be considered in the context of an inquiry, the main legal part of your Lordships' judgment, which is that you need an actual communication between client and solicitor in order for legal advice privilege to attach, and that documents created for the purpose of being laid before a solicitor but not actually so laid, do not attract privilege, that is something that has effect across all legal advice, not just in the context of litigation privilege, but all commercial, matrimonial, criminal legal advice.
view of legal advice privilege, and privilege generally. We see in the Esso case that the pendulum actually in Australia is swinging back in the opposite direction, albeit in the context of litigation privilege, where they have now changed from the Solehurst test, which was the majority in Grant v Down, and adopted the dominant purpose test.
v Down and in Waugh, all of the judges in the highest courts in both jurisdictions really decided this question on a matter of policy: where should the line be drawn? And there is a balance in our respectful submission. The balance is between ensuring that there is no fetter on the ability of a client to obtain legal advice, even where litigation is not in contemplation, and the desirability of putting as much before the court as possible, and in our submission that is a line that should appropriately be drawn by their Lordship's house.
"Well, this is all very well but it is academic in our case because of what your Lordships have held about the predominant purpose test in this case."
very wide ramification because in effect what your Lordships have said is that in any case where a corporate client, or indeed an individual client -- but more relevant to the corporate client -- is informed that it is going to be subject to some kind of inquiry -- a DTI inquiry, a stock exchange inquiry, FSA inquiry -- this happens all day long throughout the City -- and rings up its solicitors and says:
"We have been told that we may be subject to inquiry. We want you to hold our hand. We want advice every step of the way. We are not currently contemplating litigation but we want you to give us advice."
"Well, you had better tell us what the facts are."
very wide ramifications.
very rare situation in the scenario that you postulate that there is not going to be contemplation of litigation, is it not? The case we are dealing with is a rather special one because of the ambit of the Bank's protection against litigation.
very wide ramifications because it happens all the time, and the evidence before the court was described by the judge below as very cogent. Your Lordships indicate in the judgment that it was based on an assertion by Mr Croall. In our respectful submission it goes further than that because there is evidence, based on the banking officials who created or commissioned the documents, saying that the purpose for which they created those documents was to enable the Bank to get advice as well as assistance in the preparation of its case, and what your Lordships have held in effect, taking a broad view, is that, when one analyses it, the predominant purpose is not to get legal advice.
Bank be instructed, be required, to prepare their list without waiting, so that, if the Lords say no, it can be served within 24 hours of that happening, because they have indicated that they need four weeks to prepare the list of documents. We would not want that four weeks to be added on to whatever delay is going to occur while an application to their Lordships is made. So, as long as it is done that way, we are perfectly happy.
(11.07 am)