Legal professional privilege arise from common law and laws, such as the Proof Act 1995 (Cth), both in the state and in the state.
At the state level it is important to note that legal professional privilege (often referred to as client privilege) is a constitutional right of the client.
Confidential communications between a lawyer and a client, one or more lawyers acting on behalf of a client or lawyers acting on behalf of a client and a third party (such as an expert witness) for the dominant reason of offering legal advice or professional legal services in relation to an ongoing or pending legal action are protected by legal professional privilege.
Legal professional privilege often applies to sensitive documents prepared for the purpose of supplying or receiving legal advice and for the purposes of a legal action. Some exemptions from common law and the express and/or required intervention of legislative provisions can repeal legal professional privileges.
For example, if a client receives legal advice in an effort to further a crime or fraud, that advice and associated correspondence may not be subject to legal professional privilege. Furthermore, it is unlikely that a claim of legitimate professional privilege will be upheld if it is used to thwart the legal process. Legal professional privilege immunity shall extend in the context of criminal investigations and in the context of regulatory investigations by authorities such as the competition authority.
In the context of civil proceedings, where the court may order documents to be produced during a procedure such as discovery, such orders will not require the production of documents which are subject to legal professional privileges. Documents would, however, need to be listed in the list of documents that are given to the party requesting the discovery.
Communications and/or records must be confidential and have taken place or have come into being for the ‘dominant purpose’ of receiving legal advice or in relation to real or expected litigation in order to achieve legal professional privilege.
The reason for which a correspondence or document is made accessible is a matter of fact that must be objectively decided. The proof of the purpose of the author of the text, or of the person who approved or acquired it, is not necessarily definitive.
‘Dominant’ means the ‘ruling, prevailing or most powerful’ reason. In deciding whether a prevailing intent exists, the courts shall critically analyze the circumstances of the case rather than consider the subjective opinion of the individual making the contact.
Legally privileged conversations typically take place between the client and his legal representative, but can involve those between the client and a third party (e.g. consultant) where the client hires a third party to create something (e.g. tax advice) for the purpose of receiving legal advice.
If the dominant intent test is carried out, the legal professional right can be applied to documents such as:
– Letters, memoranda or other records made by the client’s staff, where such documents relate to the information requested by the client’s legal advisor to allow legal advice to be given A record or overview of legal advice, even if it is prepared by a non-lawyer but not by the client’s view on or on the basis of legal advice.
– Drafts, notes and other information brought into existence by the client for the purpose of contact to the lawyer, whether or not they are necessarily transmitted to the lawyer, or modifications to the client’s draft correspondence by the lawyer.
In Australia, courts have considered whether domestic lawyers are shielded by legal professional privilege by determining whether they behave as lawyers and have the necessary freedom to provide unfettered advice.
In order to obtain legal professional privilege, communications/documents must be made in the capacity of a lawyer to offer legal advice to the client or for the purposes of real or expected litigation.
Communications made by in-house lawyers working outside their position as legal advisers (e.g. in operational matters) will fall beyond the reach of legal professional privilege. This is also the case whenever it is known that a correspondence or document has been produced for mixed purposes.
The exercise of an impartial professional judgment is a crucial element that will be weighed in deciding whether an in-house attorney is working as a lawyer. Claims for legal professional privilege have been dismissed on the ground that in-house attorneys have not behaved with adequate arm’s length from their client, such as when papers are created by in-house lawyers who are subject to the guidance of their superiors and thus give rise to the perception that they lack the requisite independence.
Legal professional privilege was also denied in connection with communications where in-house attorneys were involved in the commercial decision-making of a deal.
Whether an in-house lawyer has a certificate of practice has also been considered by the courts in Australia when determining whether a legal professional privilege should extend to their advice. Although the failure to obtain a current certificate of practice is not inherently fatal to a claim of legal professional privilege, it could lead the court to conclude that the correspondence made and the documents produced by the in-house lawyer are not for the purpose of offering legal advice or for the purposes of litigation.
Legal professional privilege is available in respect of legal advice from international lawyers, provided that the ‘dominant intent’ condition is met.
A client shall be considered to have waived legal professional privilege if the client behaves in a manner that is inconsistent with the confidentiality that the legal professional privilege is intended to protect. In certain cases, a waiver of legal professional privilege can be implied.
It is essential to protect the confidentiality of correspondence and records attached to legitimate professional rights.
Under the Competition and Consumer Act 2010 (Cth), the Australian Competition and Consumer Commission (ACCC) has wide powers to compel the processing of records, including by subpoenas and search warrants.
The general principles of privilege (as outlined above) relate to competition or merger regulation in Australia and to compliance measures taken by the ACCC.
Although it is clear that documents subject to legal professional privilege are shielded from compulsory disclosure and production demands by regulators (such as the ACCC), it is sometimes difficult to determine if documents are privileged if the production of documents is needed immediately. If that is the case, the individual or organization which is the subject of an immediate obligation to produce documents should recognize potentially protected documents and reserve the right to assert the privilege. Potentially privileged documents should be produced separately, in a sealed envelope, to the regulator. If an understanding cannot be reached with the regulator as to whether the records are confidential, the matter of privilege would be resolved by the Court of Justice.
Usually, reports of internal investigations would be privileged if they have been produced for the purpose of offering legal advice on the subject of the investigation. On the other hand, the transaction history would usually not be privileged, even though the transaction is examined at a later date.