A course in Professional Legal Ethics
A Research Paper in
Client-Attorney Privilege
Professional Ethics – Client Attorney Privilege
Index of Contents
TABLE OF CASES ................................................................................................................. 3
AN INTRODUCTION & RESEARCH METHODOLOGY ..................................................... 4
A. HISTORICAL BASIS ................................................................................................................. 4
B. LAWYERS DUTY PERSPECTIVE ............................................................................................... 5
C. JUSTIFYING THE PRIVILEGE .................................................................................................... 5
D. THE APPLICATION OF THE RULE ............................................................................................ 6
E. RESEARCH METHODOLOGY ................................................................................................... 7
SCOPE OF PRIVILEGE ......................................................................................................... 9
A. DOES THE PRIVILEGE UNDER S.126 OF THE EVIDENCE ACT EXTEND TO COMMUNICATIONS
WITH IN-HOUSE LEGAL COUNSEL? .............................................................................................. 9
A.1 Introduction ............................................................................................................... 9
A.2 In House Counsel and Rules of Attorney-Client Privilege in the U.S. . 10
A.3 In House Counsel and Professional Privilege in the European Union 13
A.4 Arguments For and Against Grant of Attorney-Client Privilege to In
House Counsels ............................................................................................................ 15
A.5 Policy Objectives ................................................................................................... 18
A.8 What constitutes “legal advice”? .................................................................... 20
NATURE OF THE COMMUNICATIONS COVERED ........................................................ 22
A. CONFIDENTIAL AND TOWARDS SPECIFIC PURPOSE .......................................................... 22
B. DOMINANT PURPOSE V. SOLE PURPOSE: THE DECISION IN AIR INDIA V. BALABEL .......... 23
IMPLICATIONS OF PRIVILEGE ......................................................................................... 24
A. CAN A THIRD PARTY OBTAINING THE PRIVILEGED DOCUMENT BE PREVENTED FROM
DISCLOSING IT OR USING IT? .................................................................................................... 24
A.1 Innocent Receiver .................................................................................................. 25
A.2 Transmission to a fourth party ......................................................................... 25
EXCEPTIONS TO THE PRIVILEGE .................................................................................... 26
INTRODUCTION ........................................................................................................................ 26
1. WAIVER ................................................................................................................................ 27
2. THE CRIME-FRAUD EXCEPTION ........................................................................................... 27
3. THE TESTAMENTARY EXCEPTION ........................................................................................ 28
4. THE ATTORNEY SELF-DEFENSE EXCEPTION ...................................................................... 29
IN CONCLUSION ................................................................................................................. 31
BIBLIOGRAPHY.................................................................................................................... 33
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Professional Ethics – Client Attorney Privilege
Table of Cases
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Air India v. Balabal, [1987] QB 670.
Blackpool Corporation v. Locker, [1948] 1 All ER 85, 97.
Bullivant v. Att.-Gen of Victoria, [1901] AC 196.
Framzi Bhikaji, (1893) 18 Bom 263.
Goddard, [1970] 3 All ER 593.
Hickman v. Taylor, 329 U.S. 495 (1947).
Hunt v. Blackburn, 128 U.S. 464, 470 (1888).
In re Grand Jury Subpoena Duces Tecum, 112 F.3d 910, 915 (8th Cir. 1997).
Minter v. Priest, [1930] AC 558 (HL).
Philadelphia v. Westinghouse Electric Corp., 205 F. Supp. 830, 831
Radiant Burners Inc. v. American Gas Ass'n, 207 F. Supp. 771 (N.D. Ill. 1962).
United States v. Louisville & N. R.R., 236 U.S. 318, 336 (1915).
Upjohn Co. v. United States, 449 U.S. 383, 389 (1981).
Vijay Metal Works, AIR 1982 Bom 6.
Wheeler v. La Marchant, (1881) 17 Ch.D 675.
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Professional Ethics – Client Attorney Privilege
An Introduction & Research Methodology
A. Historical Basis
The attorney-client privilege is the oldest of the evidentiary privileges with a history that
can be traced to Roman and canon law.1 Official references to the rule first appear in
English decisions as early as the late Sixteenth Century. In accordance with the
justification for professional privileges in general, the attorney-client privilege was
thought to be essential to the establishment and preservation of a relationship based on
trust between attorney and client. This justification, however, fell out of favor by the last
quarter of the 18th century. The need to ascertain the truth for the ends of justice was
more urgent than the pledge of secrecy.
Subsequently, a new justification was found to sustain this pledge. This was the theory
that claims that disputes which may lead to litigation can most justly and expeditiously be
handled by practised experts, namely lawyers and that these experts can act effectively
only if they are fully advised of the facts by the parties whom they represent. Full
disclosure will be promoted if the client knows that what he tells his lawyer cannot, over
his objection, be extorted in court from the lawyers lips. This is the central principle that
serves as the contemporary justification.2
Bentham argued that the privilege is not needed by the innocent party with a righteous
cause or defence, and that the guilty should not be given its aid in constructing a false
case.3 Wigmore countered this argument by pointing out that in lawsuits all is not black
and white but a client’s case may be one where there is no clear preponderance of morals
and justice on either side, and he may think a fact fatal to his cause when it is not, and
thus be impelled, if there were no privilege, to forego resort to counsel for advice in a fair
claim.4
Fried, “The Lawyer as a Friend: The Moral Foundations of the Attorney-Client Relation”, 85
Yale LJ 1060 (1976); Hazard, “An Historical Perspective on the Attorney Client Privilege, 66
Calif.L.Rev 1061 (1978).
2
Edward W.Cleary et al, McCormick on Evidence, 3rd edn., West Publishing Co: Minnesota,
1984, p.205.
3
Supra n.2 at 205.
4
Ibid.
1
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Professional Ethics – Client Attorney Privilege
B. Lawyers Duty Perspective
As touched upon earlier, the attorney-client privilege was thought to uphold the honor of
the profession. Therefore, the attorney was considered to be the holder of the privilege.
As explained by Wigmore: "in the trials of the 1600s, the obligations of honor among
gentlemen . . . were often put forward as a sufficient ground for maintaining silence."
Contemporary law governing client confidences has two sources: agency law and the law
of evidence. Lawyers like all agents have the duty to treat information from and about
their principals as confidential to the extent that it is intended to be so by the principal,
and a duty not to use information about the principal against the principal or for the
personal gain of the agent. The duty continues even after the agency is terminated.
The duty of confidentiality is broader than the attorney client privilege. The duty of
confidentiality extends to information about the client that the lawyer learns from third
parties; the privilege extends only to information transmitted between the lawyer and
client directly. However, the difference between the client attorney privilege and an
agent’s duty of confidentiality kicks in where evidence becomes an issue. Unlike the
privilege which is a rule of evidence the agents duty of confidentiality does not allow the
agent to refuse to testify or produce evidence about confidential matters in court or before
other government bodies that have the power to compel testimony.5
C. Justifying the Privilege
The settled rationale behind the attorney-client privilege is that it promotes honest and
complete disclosure by clients and thereby serves the public's interest in competent legal
representation.6 Without the guarantee of confidentiality, clients would hesitate to reveal
embarrassing or damaging facts, and attorneys would be forced to render legal advice and
services based on partial knowledge of clients' situations. By providing attorneys with all
of the information needed to provide competent representation, the privilege is thought to
promote greater accuracy in the truthfinding process 7, despite the fact that it blocks the
5
Geoffrey C. Hazard Jr. and Susan P.Koniak, The Law and Ethics of Lawyering, The Foundation
Press Inc.: New York, 1990, p.185.
6
The Supreme Court has embraced the utilitarian rationale, stating that the purpose of the
privilege is "to encourage full and frank communication between attorneys and their clients."
Upjohn Co. v. United States, 449 U.S. 383, 389 (1981).
7
See Note, “Attorney-Client and Work Product Protection in a Utilitarian World: An Argument
for Recomparison”, 108 Harv. L. Rev. 1697, 1699 (1995).
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Professional Ethics – Client Attorney Privilege
factfinder's access to potentially relevant evidence. Under this utilitarian framework,
without some specific compelling reason to compel disclosure, it makes sense to extend
the privilege after the death of the client, since clients are more likely, on average, to be
frank with their attorneys when assured of continuing confidentiality.
The privilege also protects the privacy interests of those who seek legal representation by
ensuring that third parties do not gain access to clients' personal information. The privacy
rationale assumes that persons have an interest in protecting their reputation, even after
death, by controlling the flow of information concerning their intimate affairs. The
privilege thus serves society's interest in preserving individuals' dignity and autonomy.
At least two "political" arguments have also been advanced by scholars to explain the
privilege, both of which frame the rule as something other than a principled attempt to
protect individual freedoms or to safeguard the accuracy of court proceedings. The first
of these characterizes the privilege as a tool of the powerful, a means of allowing the
wealthy to maintain a veil of secrecy around their activities so as to avoid loosening their
stranglehold on power and resources. The second describes the privilege as a way of
enhancing the image of the legal system. According to this view, by safeguarding certain
communications between clients and attorneys, the privilege prevents society from
viewing courts as despotic juggernauts, and prevents the emergence of information after
the fact that might undermine the credibility of the factfinding process.
The last few decades have witnessed extensive debate over the proper scope of the
privilege. Much of this debate is really a debate over the appropriate reasons to have such
a privilege at all, since the differing rationales suggest different formulations of the rule.
Courts and commentators do agree that the privilege should be defined in such a way as
to shield no more information than necessary from the eye of the factfinder. After all, the
device "inevitably excludes potentially relevant information from the consideration of the
finder of fact," and thus has the potential to impair the functioning of courts.8
D. The Application of the Rule
The application of professional privilege requires the satisfaction of the following heads
formulated by Wigmore:
Erick S. Ottoson, “COMMENT: Dead Man Talking: A New Approach to the Post-Mortem
Attorney-Client Privilege”, 82 Minn. L. Rev. 1329 (1998).
8
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Professional Ethics – Client Attorney Privilege
(1) Where legal advice of any kind is sought
(2) from a professional legal advisor in his capacity as such,
(3) the communications relating to that purpose,
(4) made in confidence
(5) by the client,
(6) are at his instance permanently protected
(7) from disclosure by himself or by the legal adviser,
(8) except the protection be waived.
The first three heads are highly contentious from a theoretical and practical point of view
and it is these heads that we shall examine in detail in this research paper.
E. Research Methodology
The objective of this paper is to answer the following questions:
a) What is the historical basis of the rule of professional privilege?
b) What is the scope of the privilege?
b.1) Who are the legal professionals covered by the privilege?
b.2) Specifically, whether in-house legal counsel are covered by the privilege?
c) What is the nature of the communications covered by the privilege?
d) What are the implications of the application of the privilege?
e) What are the exceptions to the application of the privilege?
The authors were constrained by the following limitations during the course of their
research:
a) Lack of specific material on the nexus between professional privilege as a rule of
evidence and the ethical duty of a lawyer to preserve the confidentiality of
communications by his client.
b) Lack of critical material on contemporary issues in legal ethics.
The following are the methodological tools employed in this research paper:
a) Analytical – e.g Extent/Scope of Privilege
b) Descriptive – e.g. Historical Basis of the Privilege
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Professional Ethics – Client Attorney Privilege
The manner of footnoting is uniform.
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Professional Ethics – Client Attorney Privilege
Scope of Privilege
A. Does the privilege under S.126 of the Evidence Act extend to
communications with in-house legal counsel?
A.1 Introduction
The attorney-client privilege protects certain communications between attorney and client
from compelled disclosure. The privilege applies to clients who are individuals as well as
to corporate clients.9 The lawyers providing legal services to corporations may be outside
attorneys who are employees of law firms. Many corporations, however, rely on in-house
attorneys for many, if not all, of their legal needs.10 Often, in-house attorneys have
official responsibilities that involve them in the management of the company.11 Even if
the attorneys do not have official nonlegal responsibilities, the corporation may seek the
opinion of in-house attorneys with regard to all sorts of issues, some of which may be
clearly legal issues, some of which may be clearly business issues, and some that are a
jumble of both. Even outside attorneys sometimes hold positions within the management
of corporations. Likewise, corporations may consult outside attorneys, whether or not
they have management responsibility, not only with regard to legal issues but also
business issues or issues involving a mix of business and legal considerations.12
9
See Upjohn Co. v. United States, 449 U.S. 383 (1981) (clarifying that the privilege applies to
corporations).
10
In-house law departments are often bigger than most firms. For example, in 1996 General
Electric had 507 in-house attorneys while Exxon had 430. Some insurance companies had more
in-house attorneys. See, The 1996 Corporate Legal Times 200 Largest Legal Departments, Corp.
Legal Times, Aug. 1996, at 1. Since the 1960s in-house law departments have increased in size.
See Carol Kleiman, In-House Lawyers Making a Comeback, Chi. Trib., Mar. 31, 1991, 8, at 1
(Kemper had 86 attorneys in 1985 and 141 in 1991).
11
See, e.g., Bruce T. Rubenstein, Bringing a Broader Business Perspective to the Job of General
Counsel, Corp. Legal Times, July 1996, at 7 (general counsel is also a member of "The Group of
Corporate Officers" that participates in strategic planning); Angela Ward, Only Happy Problems
for Platinum's General Counsel, Corp. Legal Times, Nov. 1994, at 14 (general counsel is also
Chief Operating Officer); Bruce Rubenstein, Hyatt General Counsel Adds Vice PresidentDevelopment to Title, Corp. Legal Times, Oct. 1994, at 4 (general counsel also Vice President of
Development).
12
The principal of an association of attorneys with in-house expertise stated, "It is typical for us to
be asked for our business view of issues as well as our legal view." Bruce Rubenstein,
Independents: No Associates, No Staff, No $ 300-an-Hour Billers, Corp. Legal Times, Dec. 1995,
at 28. A managing partner of a group of attorneys who are former partners or associates at large
firms stated that the clients "use us for practical advice too." Ibid.
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Professional Ethics – Client Attorney Privilege
While the legal profession should perhaps cheer this evolution of roles and duties, the
application of the attorney-client privilege in the corporate representation environment
creates problems because the tradition of the privilege requires that it apply only to a
communication involving a lawyer in his or her professional legal capacity and only if the
communication relates to obtaining or rendering legal advice, services, or assistance.
Courts have not agreed in defining the kinds of services rendered by attorneys that the
privilege protects. Nor have courts acted consistently and uniformly in dealing with
communications containing a mix of advice, service, and assistance. The resulting
confusion in this area of privilege law has proved to be fertile ground for some courts'
reliance upon antiquated notions about what attorneys do and particularly what attorneys,
inside and out, do for corporate clients. Some courts have exhibited significant bias
against corporations and particularly against in-house counsel, relying on assumptions
based on status and supposed probabilities. The resultant uncertainty of whether the
privilege applies in particular corporate settings threatens the privilege's ability to create
the positive impact of client disclosure and, therefore, a positive impact on the justice
system, the raison d'etre of the privilege.
A.2 In House Counsel and Rules of Attorney-Client Privilege in the U.S.
Attorney-client privilege 100 has been recognized in the U.S. since 188813 and for inhouse counsel, since at least 1915.14 The main issues in the U.S. are 1) who exactly is the
client and 2) how far should the privilege be extended.15 Recognition of the attorneyclient privilege is a policy choice that acknowledges that the seeking of legal advice is
important although it may make finding the truth somewhat more difficult.16 The
justifications for the existence of the attorney-client privilege are similar to the
justifications espoused by the EC and its Member States. However, there is debate in the
U.S. whether the justifications for privileged communications between an attorney and
13
See Hunt v. Blackburn, 128 U.S. 464, 470 (1888).
See United States v. Louisville & N. R.R., 236 U.S. 318, 336 (1915).
15
These questions are beyond the scope of this project. However, several tests have been created
by the courts to determine to whom the privilege should be extended. A good overview of these
tests can be found in Upjohn Co. v. United States, 449 U.S. 383, 389-394 (1981) and Note, The
Attorney-Client Privilege and the Corporate Client: Where Do We Go After Upjohn? 81 Mich L.
Rev. 665, 668-691 (1983).
16
Stephen A. Saltzburg, The Federal Rules of Evidence: Corporate and Related Attorney-Client
Privilege Claims: A Suggested Approach, 12 Hofstra L. Rev. 279, 283 (1984).
14
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Professional Ethics – Client Attorney Privilege
his client are as forceful when the client is a corporation or when the attorney is in-house
counsel.17
Attorneys in the U.S. are governed by the rules and codes of conduct of their states. The
rules for in-house counsel are generally the same as the rules for lawyers practicing on
their own, for the government or in firms.18 The issue in the U.S. is not whether in-house
counsel should be allowed to exercise the attorney-client privilege, but rather who in a
particular company should be included in that protection. Although the rules differ
somewhat by jurisdiction, all attorneys have an obligation to maintain the confidences of
their clients. There are exceptions to the general rules that in some cases allow and in
other cases require the attorney to disclose the confidential information.19 The rules are
intended to prevent an attorney (whether independent or in-house) from using their
duty/right of confidentiality to obstruct justice, either for personal gain or because of
demands by the client.
The leading case in the U.S. discussing the availability of the attorney-client privilege for
in-house counsel is Upjohn Co. v. United States.20 After a letter to the Securities and
Exchange Commission and the Internal Revenue Service (IRS), an investigation of
Upjohn began.21 In connection with the investigation, Upjohn refused to produce some of
17
See, e.g., Radiant Burners Inc. v. American Gas Ass'n, 207 F. Supp. 771 (N.D. Ill. 1962), rev'd
320 F.2d. 314 (7th Cir. 1963); Michael L. Waldman, Beyond Upjohn: The Attorney-Client
Privilege in the Corporate Context, 28 Wm. & Mary L. Rev. 47381 (1987).
18
The obligation of confidentiality is the same for in-house counsel as for independent lawyers.
Sara A. Corello, Note, In-House Counsel's Right to Sue for Retaliatory Discharge, 92 Colum. L.
Rev. 389, 411 n.126 (1992) citing Doe v. A. Corp., 709 F.2d 1043, 1046-48 (5th Cir. 1983).
Government lawyers are subject to additional special provisions. See, e.g., Model Rules of
Professional Conduct, Rule 1.11, 6.2, 6.3, 6.4 (1992) [hereinafter Model Rules]; Model Code of
Professional Responsibility, DR 7-103, DR 8-101 (1983) [hereinafter Model Code].
19
The most important exceptions are those enacted to prevent a future crime or to prevent false
evidence being presented to the courts. In Model Code jurisdictions, a lawyer may reveal: (1)
Confidences or secrets with the consent of the client or clients affected, but only after full
disclosure to them. (2) Confidences or secrets when permitted under Disciplinary Rules or
required by law or court order. (3) The intention of his client to commit a crime and the
information necessary to prevent the crime. (4) Confidences or secrets necessary to establish or
collect his fee or to defend himself or his employees or associates against an accusation of
wrongful conduct.
20
Upjohn Co. v. United States, 449 U.S. 383 (1981).
21
In Upjohn, Mr. Gerard Thomas, General Counsel for Upjohn, learned from accountants working
for the corporation that one of Upjohn's foreign subsidiaries had been making payments to
foreign governments to secure government business. Mr. Thomas discussed the situation with the
Chairman of the Board and an investigation of the "questionable payments" was started. A letter
and questionnaire were sent to "All Foreign General and Area Managers" requesting information
about the payments and stating that the investigation was to be considered "highly confidential."
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Professional Ethics – Client Attorney Privilege
the documents demanded by the IRS,22 claiming that they were protected from disclosure
by attorney-client privilege and the work product doctrine.23
In reaching its decision that the documents demanded, including the written questionnaire
and its answers, were protected, the Court briefly reviewed the history of and
justifications behind the development of the attorney-client privilege and Federal Rule of
Evidence 501. The Court said that the purpose of privilege is to encourage the
"communication of relevant information by employees of the client to attorneys seeking
to render legal advice to the client corporation."24 Only by allowing uninhibited
communication with attorneys can the public interest in justice be served.25 Furthermore,
the Court recognized that, although the communication was protected, the underlying
facts were not.26 The decision did not question the proposition that in-house counsel
should be entitled to the same attorney-client privilege as other lawyers.
The Upjohn case gave the Supreme Court the opportunity to explain clearly why and to
what extent the attorney-client privilege should apply to corporations and to in-house
counsel specifically; unfortunately, it did not.27 Cases heard in lower courts have
In March 1976, Upjohn submitted a Form 8-K to the Securities and Exchange Commission and
the Internal Revenue Service (IRS) disclosing the questionable payments. The IRS began an
investigation and issued a summons on November 23, 1976, demanding production of
documents.
22
The IRS summons demanded "production of 'all files relative to the investigation conducted
under the supervision of Gerard Thomas identifying payments to employees of foreign
governments.'". The summons went on to state that "the records should include but not be limited
to written questionnaires sent to managers of the Upjohn Company's foreign affiliates and
memorandums or notes of the interviews conducted in the U.S. and abroad with officers and
employees of Upjohn Company and its subsidiaries."
23
The work product doctrine protects attorneys' work prepared in anticipation of litigation. See
Hickman v. Taylor, 329 U.S. 495 (1947).
24
Upjohn Co. v. United States, 449 U.S. 383 (1981).
25
A lawyer needs to have full and frank communications with his client in order to "promote the
broader public interest in the observance of law and administration of justice. The privilege
recognizes that sound legal advice or advocacy serves public ends and that such advice or
advocacy depends upon the lawyer's being fully informed by the client." Ibid at 389
26
The protection of privilege extends only to communications and not to facts. A fact is one thing
and a communication concerning that fact is an entirely different thing. The client . . . may not
refuse to disclose any relevant fact within his knowledge merely because he incorporated a
statement of such fact into his communication to his attorney. Ibid at 395-396, citing Philadelphia
v. Westinghouse Electric Corp., 205 F. Supp. 830, 831
27
When the United States Supreme Court agreed to hear Upjohn Company v. United States,
scholars and practitioners alike took note. For decades, the Court had accepted tacitly the
proposition that the attorney-client privilege available to individuals also was available to
corporations, but it never had delineated the scope and meaning of the corporate attorney-client
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Professional Ethics – Client Attorney Privilege
recognized that the attorneyclient privilege is available to in-house attorneys, but do not
agree on the scope of the privilege.28 Although the Supreme Court did not clearly explain
and justify its recognition of the availability of the attorney-client privilege to in-house
counsel, it is a well-settled point of law.29
A.3 In House Counsel and Professional Privilege in the European Union
While the rules of legal privilege have deep roots in the European legal systems, the
legislation and case law in Europe on outside and in-house counsel privilege is often
much less developed and refined than in the United States. The main reasons are, first,
that except the United Kingdom and Ireland, most European countries do not have the
adversarial and extensive discovery system that forms the foundation of U.S. litigation.30
Second, perhaps, lawyers and litigation until recently played a less important role in
corporate management in Europe than in the United States. Questions of privilege
therefore arose less often.
Recently, however, legal privilege has been the subject of renewed interest in the
European Communities (EC). The European Commission has wide discovery powers. It
is able to ask for production of documents through "Article 11 letters" and may conduct
"verifications," essentially dawn raids on the premises of companies suspected of
infringements of EC competition law.31 With the emergence of national competition laws
cloned from EC law, these powers are replicated in the EC Member States' national legal
systems. This growing complexity combined with increasing number of business
privilege. . . . Upjohn provided an opportunity for the Supreme Court both to explain its
willingness to extend to corporations a privilege originally designed for individuals and to define
precisely the scope and meaning of the corporate privilege. The Upjohn Court allowed the
opportunity to pass, however. John E. Sexton, A Post-Upjohn Consideration of the Corporate
Attorney-Client Privilege, 57 N.Y.U.L. Rev. 443, 443-44 (1982)
28
The only case which refused to recognize the attorney-client privilege for a corporation was
reversed on appeal [Radiant Burners Inc. v. American Gas Ass'n, 207 F. Supp. 771 (N.D. Ill.
1962), rev'd, 320 F. 2d. 314 (7th Cir. 1963)].
29
See, e.g., Upjohn Co. v. United States, 449 U.S. at 397; Natta v. Hogan, 392 F.2d 686, 692
(10th Cir. 1968); Sperti Products Inc. v. Coca Cola Co., 262 F. Supp. 148 (D. Del. 1966).
30
Apart from the United Kingdom and Ireland, limited forms of disclosure exist in Denmark and
Norway. In other countries, claimants must resort to different and more difficult means, such as
the principles of tort law or special procedural rules (such as preliminary witness hearings) to
compel disclosure of documents known to exist but not available to claimants. Note that some
countries (such as The Netherlands) have made reservations under the Hague Convention on the
Taking of Evidence abroad against pre-trial discovery proceedings, and that a court may therefore
refuse interrogatory letters in such a case.
31
Council Regulation 17/62, 1962 O.J. Spec. Ed. 204, arts. 11 & 14
13
Professional Ethics – Client Attorney Privilege
transactions requiring antitrust advice has amplified concerns over the limits of the legal
privilege.
While outside counsel legal privilege was recognized by the European Court of Justice in
AM&S Europe Ltd v. Commission32, the Commission has taken a critical attitude towards
requests for in-house counsel privilege.33 This is perhaps understandable, given hearsay
stories of companies attempting to dodge investigations. Many will argue, however, that
the proper remedy is not to deny in-house counsel privilege, but to recognize it. This
would allow in-house counsel the freedom to advise its client about the legal
consequences of conduct without fear that its advice and any confessions made by the
client will be subject to Commission scrutiny later. In-house counsel can play an
invaluable function in maintaining the rule of law, and could be encouraged to assist
rather than resist competition authorities in their role as guardians of fair competition.
Commission decisions seem to take exactly the opposite approach. In the Sabena/London
European34 and John Deere35 cases the Commission even went so far as to cite in-house
counsel advice as evidence that the company knowingly and intentionally infringed
competition law. Problems also arise during verifications: in a recent case, the
Commission denied a company the right to call in outside counsel--it did not wish to wait
until counsel arrived--on the ground that in-house counsel was perfectly able to assist and
advise the client, and yet insisted that a Commission official listen in to every
conversation between the in-house counsel and his client during the verification.36
Such a result is inefficient from an enlightened enforcement perspective and contrary to
common notions of fairness, and something must be done to avoid similar situations in
the future. Proposals have been made that in-house counsel privilege should be
recognized in an amendment of Regulation 17/62, in a Directive harmonizing the role of
32
Case 155/79, 1982 E.C.R. 1575
Confidentiality of Legal Documents: Application of the Competition Rules Bill. EC 6-1983, at
43
34
Commission Decision 88/589/EEC, 1988 O.J. (L 317) 47
35
Commission Decision 85/79/EEC, 1985 O.J. (L 35) 58.
36
This recently occurred during several dawn raids (no relevant information published). The
Commission based its position on Section 6 of the Explanatory Note that is normally attached to
verification decisions, stating that the Commission officials have instructions not to delay the
verification for the arrival of a legal advisor if the firm has an internal legal service, 13th Report
on Competition Policy, 270-72 (1982), in conjunction with a restrictive interpretation of the rules
of privilege based on the AM&S case.
33
14
Professional Ethics – Client Attorney Privilege
lawyers in the EC, or by special decision.37 But legislative proposals will be difficult to
complete without amending Regulation 17/62 (the basic procedural regulation). There is,
however, a concern that some Member States will use the amendment process as an
excuse to limit the Commission's powers, and reinforce the role of national antitrust
authorities. This result might endanger the one-stop shop principle and raise the specter
of divergent application of EC (and national) antitrust rules.
A.4 Arguments For and Against Grant of Attorney-Client Privilege to In House
Counsels
Many companies have decided for a variety of reasons that their legal needs can be best
met if they have one or more attorneys who are employees of the corporation. The
corporation is the only client of these attorneys. The recognition that the corporation's
right to the attorney-client privilege is the same whether the attorney is in-house or
independent is well settled in the U.S. while the non-recognition for in house counsel of
the privilege in the EC is equally well-settled. It is submitted, however, that a perusal of
arguments both for and against the extension of attorney-client privilege to in house
lawyers would indicate that the former definitely outweigh the latter.
Generally, critics argue that the privilege should not apply to in house counsel for two
reasons. First is the argument advanced that an attorney will be influenced by the
business needs of the company causing his independent professional judgment to be
impaired.38 It is argued that because of the very fact and terms of employment, in house
attorneys are dependent on the corporation for their livelihood and therefore their
judgement is impaired in matters of law and ethics.
37
For a thoughtful analysis of the issue of in-house counsel privilege and a proposal for a
directive, see Carl Belding (of IBM), Privilege for In-house Counsel in Competition Law
Proceedings in the European Union, NYBA Meeting, Oct. 9-13, 1996. Others have proposed to
give advice only orally, which in most cases would be imprecise and impractical, or have legal
advice confirmed by in-house counsel. See, e.g., J. Carr, Are Your Internal Communications
Protected?, European Counsel, Sept. 1996, at 27
38
The inference is that lawyers who are bound to the client by a relationship of employment are:
(i) not independent; (ii) subject to the directions of the employer, which may conflict
diametrically with the obligation to produce documents; and (iii) therefore capable of being
subjected to pressures which might prevent the salaried legal adviser from exercising the
independent discretion in relation to production of documents which alone could justify extending
the activities of such advisers the shield of legal privilege. See, Stephen Charles, “Legal
Professional Privilege: Continued Erosion”, 57 Law Inst. J. 832, 833 (1983)
15
Professional Ethics – Client Attorney Privilege
However, Although it is true that in-house counsel are dependent on their corporation
client for their income and job security, it does not necessarily follow that they will be
more easily subject to influence. Institutional rules like the Model Rules, etc. place a
good deal of importance on the need for a lawyer to maintain certain professional
standards that require him to remain free from being unduly influenced by his corporation
client. The problem of undue influence by the business people is generally diffused by
the fact that corporate legal departments are segregated from the rest of the company "to
protect not only the autonomy of the law department . . . and the corporation's long-term
interest in having its executives' business practices adequately monitored."39 It is not clear
that situations where attorneys are pressured to go against their judgment because of
corporate pressure are common. For these reasons, it is unlikely that charges that inhouse counsel are more easily corrupted or influenced by their client than independent
counsel are valid.
Second, critics argue that it is difficult to determine when the attorney is acting as an
attorney and when a communication is legal, and these issues are important because only
legal communications can be protected.40 The attorney-client privilege in the U.S. and the
EC both require the communication to be between an attorney and his client, with the
attorney acting as an attorney. The implication of this argument is that in-house counsel
are often intimately involved in all the company's affairs and therefore it may be difficult
to determine whether a communication is legal or business and therefore whether the
privilege should apply.
U.S. courts have dealt with this problem in different ways, but it does appear possible to
distinguish between legal and non-legal advice and to prevent the privilege from applying
where it should not.41 As with any other attempt to claim that communications are
privileged, a conversation with in-house counsel will only be protected if it is "legal" in
nature. Despite the difference in the relationship between in-house and independent
attorneys and their clients, since only legal conversations are privileged, there will be no
additional evidentiary cost to the adverse party than if the client had retained independent
counsel.
Eve Spangler, “Lawyers For Hire”, Salaried Professionals at Work 78 (1986).
See, Sara A. Corello, “Note, In-House Counsel's Right to Sue for Retaliatory Discharge”, 92
Colum. L. Rev. 389, 417 (1992)
41
The specific requirements and tests used by courts differ but the result has been that non-legal
advice has generally not been protected. See John E. Sexton, “A Post-Upjohn Consideration of
the Corporate Attorney-Client Privilege”, 57 N.Y.U.L. Rev. 443 (1982), at 489.
39
40
16
Professional Ethics – Client Attorney Privilege
Further, there are four main arguments why in-house counsel should be given the
attorney-client privilege. First, in-house counsel may actually be in a better position than
independent lawyers to encourage lawful behavior by the client and the administration of
justice by having more influence over the officers and directors of the company. In-house
lawyers are very involved on a regular basis with many aspects of the corporation. It is
possible that these attorneys are able to influence the corporation not to do something that
is illegal or questionable because of their long-standing relationship with the company or
the fact that they are more involved with the day-to-day affairs of the company. The
officers and directors might be more willing to listen to the in-house attorney whom they
know and have developed a relationship with when they might ignore an independent
attorney hired to complete a particular job who recommends the company not proceed.42
In-house attorneys differ from outside corporate counsel in that they have better access to
the facts, their personal and professional ties are to their client, and they are often asked
to make decisions, rather than give advice. Therefore in-house counsel has greater ability
to alter her client's behavior and thus a corresponding duty to use that ability to promote
constructive behavior by the client.
Second, lawyers in firms may not actually be more independent than in-house lawyers.
The independence of outside firms as contrasted with in-house counsel may be illusory.
In many situations, independent lawyers work extremely closely with one or only a very
small number of clients and may be as closely linked to the company as in-house lawyers
are. Competition for clients is extremely high and a firm that establishes a relationship
with a client is not going to be willing to leave the client.
Third, if the attorneys are subject to the same ethical principles, have the same duties to
uphold the law and are required to maintain the same independence of judgment from the
clients, they should be permitted the same rights as the other attorneys. There are certain
countries who allow in house counsels to remain members of the Bar, and such lawyers
are are bound by the same rules of conduct and code of ethics as other lawyers in that
country. Where in-house and independent attorneys are bound by the same rules and have
the same duties to uphold the law, they should receive the same treatment. However, it
must be clarified that this argument does not apply to countries where in house counsels
42
The influence of an attorney in suggesting an alternative course of action depends mainly on the
business person's prior experience with that attorney. 'You attain a lot of credibility in the
company,' says one lawyer, 'because of your aptitude with business issues, your apparent
willingness to really dig in and examine issues closely and develop a solution and not take the
easy way out and say you can't do something.' Spangler, supra note 35, at 93.
17
Professional Ethics – Client Attorney Privilege
are not members of the Bar. Clearly in the countries where in-house counsel are not
members of the bar and are not expected to behave in the same manner as other lawyers,
it would be difficult to argue that they should have the right to the attorney-client
privilege because they are not acting as a lawyer for the company. These lawyers are no
longer practicing lawyers; denying them the privilege is sensible because there is not a
mechanism to deal with breaches of duties of lawyers when they are not lawyers.
A.5 Policy Objectives
One major goal of any legal system is to efficiently administer justice. In order for
corporations to exist within the legal system, and for justice to occur when one of the
parties is a corporation, lawyers need to be involved. It seems unnecessary and even
unjust to penalize a corporation for choosing to have lawyers on the payroll, rather than
employing them through an independent firm. The attorney-client privilege has been
recognized in both the U.S. and the EC as an important part of the relationship between a
lawyer and his clients. Arguments advocating exclusion of in-house counsel from the
privilege because of the underlying assumption, that in-house counsel cannot remain free
from influence by their client, are not really sustainable. It is possible and perhaps even
likely, that in-house counsel can influence the behavior of the client more easily than
independent lawyers, and that they actually may be as independent in their actions as
lawyers who are not employed by a corporation. Thus allowing in-house counsel and
their client company the attorney-client privilege would allow the benefits that flow from
the existence of the privilege to occur in these additional situations.
A.6 Summarising the British and Indian Position: Does the privilege under S.126 of
the Evidence Act extend to communications with in-house legal counsel?
It is our submission that in-house lawyers are included within the purview of Section 126
of the Indian Evidence Act.
In Blackpool Corporation v. Locker43 the court observed that in order for the privilege to
apply what matters is not the lawyers job title but whether he is exercising professional
skill as a lawyer. Alfred Crompton Amusement Machines v. Customs and Excise
Commissioners44 serves as the leading authority to extend this general formulation to the
43
44
[1948] 1 All ER 85, 97.
[1972] 2 QB 102.
18
Professional Ethics – Client Attorney Privilege
specific case of “in-house lawyers”. There the court held that “as salaried legal advisors
whether Barristers or Solicitors, employed by a commercial concern had precisely the
same duties and privileges as lawyers in independent practice [and therefore]
professional privilege attached to all the communications between the officials and their
legal department both in the ordinary course of work and when litigation was
anticipated.”
Now what must be determined is whether the British position can be extended to India. It
is our submission that the position in India is the same. In Framji Bhikaji v. Mohan
Singh45 it was held that the law of evidence in India is the same as that in England and
courts may refer to English cases in order to interpret it. However there is no need to
resort to Framji Bhikaji because in Municipal Corporation of Greater Bombay v. Vijay
Metal Works46 the court held that “a salaried employee who advises his employer on all
legal questions and also other legal matters would get the same protection as others, viz.,
barrister, attorney, pleader or vakil, under Ss.126 and 129, and, therefore, any
communication made in confidence to him by his employer seeking his legal advice or by
him to his employer giving legal advice should get the protections of Ss.126 and 129.”
A.7 Under S.126 of the IEA, what communications with in-house legal counsel are
covered?
There is one fairly obvious caveat to the classification of communication with in-house
lawyers as privileged. It must be seen whether the in-house lawyer was consulted in the
capacity of a lawyer or as an executive. It may happen that what was sought from the
lawyer was not legal advice, in which case the privilege would not be extended to the
communication. Therefore it is not as if all communication between an in-house lawyer
(or any lawyer for that matter) and an official is privilege. There in the case of an inhouse lawyer it must be seen whether the communication was legal advice or related in
any way to the obtaining of legal advice. This test was reiterated in Blackpool
Corporation, supported by Phipson and applies in India not just by logical extension but
also by virtue of the fact that the decision in Vijay Metal Works requires the giving of
‘legal advice’ and on page 9 it expressly recognizes the distinction between legal and
executive capacity.
45
46
(1893) 18 Bom 263.
AIR 1982 Bom 6.
19
Professional Ethics – Client Attorney Privilege
A.8 What constitutes “legal advice”?
In Municipal Corporation of Greater Bombay v. Vijay Metal Works47 the Law Officer of
the Municipal Corporation had prepared a note for the purpose of sending a reply by the
Municipal Commissioner to a letter of the State Government. No legal advice was sought
on any question. The sum and substance of the note was that eviction proceedings under
the Corporation Act had been started against the occupants of the Arches below a bridge
on the ground of reconstruction of the said bridge but that these people were not actually
covered and proceedings should be dropped. The communication was held not to be
privileged. It’s important to note that the statements of the law officer concern a legal
situation and legal rights but were not construed to be legal advice. Therefore it can be
said that focus is on the term ‘advice’ and it is not sufficient if there was legal talk or the
statements concerned the law. This is consistent with the fact that the term “advice”
implies legal guidance given.48
Furthermore, it may be argued that the term “advice” must be construed narrowly in the
contest of in-house lawyers because of their tendency to act in executive capacity. The
court in Municipal Corporation of Greater Bombay v. Vijay Metal Works49 recognised
the observation in Crompton that a legal advisor (in a company) may act in an executive
capacity and further that the “system is susceptible to abuse”. The court was encouraged
to look into the communication to assess whether it was worthy of privilege [Vijay Metal,
page 9]. This could imply that the term advice would be construed narrowly to ensure
that only legal advice was covered.
Additional Note:
It is also important to note a further observation in Phipson on Evidence. It is observed
that sometimes a law firm or a legal department may be consulted in legal capacity but
the actual advice may be given by a paralegal or an accountant within the department.
Even in such a case the communication may be privileged provided the department or
firm was consulted in legal capacity because in such a case despite the fact that a nonlawyer actually gave the advice it may be construed to be the advice of the firm or the
department.50
47
AIR 1982 Bom 6.
Black’s Law Dictionary, 17th Edition, page 55
49
Supra n.48 at 9.
48
20
Professional Ethics – Client Attorney Privilege
Therefore the position of law is as follows:
1. In-house lawyers are included within S.126 provided they were consulted in legal
capacity
2. Advice must be sought or given.
3. Advice by paralegals or accountants within a law firm or a legal dept. may also be
covered provided (i) the firm was consulted (ii) in a legal capacity
50
Phipson on Evidence, 15th Edn., p.514, Paragraph 20-14.
21
Professional Ethics – Client Attorney Privilege
nature of the communications covered
A. Confidential and towards Specific Purpose
The communications must have been confidentially made for the purpose of the
employment, or the knowledge confidentially obtained solely in consequence of it, to be
privileged. A conversation between solicitor and client is not necessarily privileged. To
be privileged it must be fairly referable to such relationship, though this requirement is to
be generously interpreted. If it is not so referable, then the mere fact that a person
speaking is a solicitor and the person addressed is his client affords no protection.
Communications, even at an interview for the purpose of receiving professional advice,
are not protected unless they pass for that purpose.51 Cases submitted to solicitor or
counsel for opinion and opinions thereon are prima facie privileged.52
Instructions from a party’s solicitor to counsel to prepare a deed, together with
correspondence and papers relative thereto unless, on the evidence, it was done with the
express object of committing a fraud or illegality.53 Notes of professional interviews and
communications, whether made by solicitor or client are all in the same position. A
lawyers confidential letter to his client for the purpose of obtaining information or
instructions as to legal proceedings is privileged although containing a statement of fact
as to what took place.54
If the document is not confidential, either originally or because of a subsequent voluntary
publication, it is not privileged. However mere reference to a privileged document in the
pleadings will not destroy the protection.55
Communications to a solicitor respecting matters of fact, as distinguished from legal
advice, may not be privileged. In Bramwell v. Lucas56 a client’s enquiry of his solicitor,
“whether he could attend a meeting of his creditors without being arrested,” was held not
51
M.N.Howard et al, Phipson on Evidence, 14th edn., Sweet and Maxwell: London, 1990, p.504.
Ibid.
53
Bullivant v. Att.-Gen of Victoria, [1901] AC 196.
54
Supra Phipson at 505.
55
Ibid.
56
2 B.&C. 745.
52
22
Professional Ethics – Client Attorney Privilege
privileged on this ground; but this case seems to fall precisely within the protection and is
unlikely to be followed.
B. Dominant Purpose v. Sole Purpose: The Decision in Air India v. Balabel
The mere fact that the solicitors work is done in the context of a transaction conducted on
behalf of the client does not of itself give rise to privilege over all the communications
passing between them. In Balabal v. Air India57, the Court of Appeal said that the
increased scope of the work habitually done by solicitors required that the circumstances
in which the privilege attached be reexamined. The Court identified two approaches in
the authorities. Under the broad view, any communication by a client to a solicitor is
privileged if it is made in the course of a professional relationship.58 The narrow view
accorded privilege only to those communications associated with the seeking of legal
advice.59 It is the narrow view which has prevailed but the request for advice does not
have to be express.60 Nor is it necessary for the communication, in respect of which the
privilege is claimed, itself to be or amount to legal advice or a request for legal advice; it
is enough if it comes into existence in the context of the approach for legal advice.61
57
[1988] 2 WLR 1036 (CA).
Minter v. Priest, [1930] AC 558 (HL).
59
Wheeler v. La Marchant, (1881) 17 Ch.D 675.
60
Supra Phipson at 510.
61
After Balabal.
58
23
Professional Ethics – Client Attorney Privilege
Implications of Privilege
A. Can a third party obtaining the privileged document be prevented from
disclosing it or using it?
It is our submission that as a general rule a third party obtaining a privileged document
accidentally or deliberately can be injuncted from disclosing it but in certain
circumstances the privileged documents may be used.
As a general rule the privilege subsists even after the information has been communicated
to another party. This was the basis upon which the courts proceeded in Lord Ashburton
v. Pape62, Butler v. The Board of Trade63 and Goddard and Another v. Nationwide
Building Society64. There are however two not so well defined exceptions:
Exceptions:
1. Secondary Evidence if restraint not claimed before use: The decision in Goddard
and Another v. Nationwide Building Society65 has affirmed the proposition that “if a
litigant has in his possession copies of documents to which legal professional
privilege attaches he may nevertheless use such copies as secondary evidence in his
litigation: however, if he has not yet used the documents in that way, the mere fact
that he intends to do so is no answer to a claim against him…for delivery up of the
copies or to restrain him from disclosing or making use of any information contained
in them.” As Nourse L.J. put it in page 685 “the crucial point is that party who
desires the protection must seek it before the other party has adduced the confidential
communication in evidence or otherwise relied on it at trial.” In India, as well, one
must rely on equity when moving against third parties because Section 126 only
prohibits the lawyer from disclosing the privileged information. Therefore the
principles laid down in Goddard can be applied because they are equitable principles.
2. Exceptions dealt with in the Exceptions chapter.
62
[1911-13] All ER 708.
[1970] 3 All ER 593.
64
[1987] QB 670.
65
[1987] QB 670 at 670.
63
24
Professional Ethics – Client Attorney Privilege
A.1 Innocent Receiver
It is our submission that whether the documents were innocently or illegally obtained is
irrelevant insofar as exercising the privilege is concerned.
Whether the documents were illegally obtained or innocently received is irrelevant for the
purposes of seeking their return or preventing their use. This was affirmed in Butler v.
Board of Trade66 and reaffirmed in Goddard and Another v. Nationwide Building
Society67. Goddard is recognized as a leading authority on this issue.68
A.2 Transmission to a fourth party
In Goddard v. Nationwide Building Society69 the court held that the party in whom the
privilege vested was entitled to delivery up of the original documents and even the copies
that were made of it. Furthermore they were injuncted from disclosing or making use of
the information contained in those documents. In Ashburton v. Pape70 the court clearly
state that the injunction extended to restraining the defendant from divulging or
propagating the information. It would be logical to deduce that the third party could also
be injuncted from divulging the information to a fourth party. This is consistent with the
abovementioned principle that the privilege is independent of the number of times the
document changes hands or who receives it.
66
[1970] 3 All ER 593
[1987] QB 670.
68
Phipson on Evidence, 15th Edn. p.587.
69
[1987] QB 670.
70
[1911-13] All ER 708.
67
25
Professional Ethics – Client Attorney Privilege
Exceptions to the Privilege
Introduction
Despite debate over the proper scope of the attorney-client privilege, courts have been
reluctant to establish any general judicial discretionary authority to waive the privilege
when a balancing of the relevant interests indicates that abrogation of the privilege is
justified.71 Courts reason that only a test that ensures predictability will adequately
protect the interests served by the privilege, since clients will be less likely to disclose
incriminating or embarrassing information if they are unsure whether the court may later
force the attorney to reveal that information in a judicial proceeding. 72 While a number of
proposed "balancing tests" have been advanced over the years, none has proven concrete
enough to satisfy courts and commentators that its implementation would result in
uniform application.73
Despite powerful theoretical arguments for retaining a near-absolute privilege, the
empirical assumptions underlying the rule are less than settled. Proponents of the
balancing approach suggest that in many, if not most cases, an exception allowing for
disclosure in limited circumstances would make no real difference to clients, and that the
normal lawyer-client relationship would thus go unaffected. A strict rule against
nondisclosure in all circumstances, they argue, unnecessarily adheres to the theoretical
justifications behind the privilege and ignores the practical benefits of allowing such
disclosure.74
Despite the general tendency to retain a nearly absolute attorney-client privilege, courts
have recognized exceptions to the privilege in a few limited sets of circumstances,
including cases of waiver by the client, cases in which a client seeks or uses legal advice
in furtherance of a crime or fraud, and testamentary disputes. In addition, third parties
71
See, e.g., Jaffee, 116 S. Ct. at 1932 (recognizing a patient-psychotherapist privilege, but
refusing to adopt a balancing approach allowing abrogation of the privilege where trial judge later
determined that evidentiary need for disclosure outweighed patient's interest in privacy); In re
John Doe Grand Jury Investigation, 562 N.E.2d 69, 71 (Mass. 1990) (refusing to adopt a rule
allowing abrogation of the privilege when society's interest in the truth outweighed the harm
caused by disclosure).
72
Erick S. Ottoson, “COMMENT: Dead Man Talking: A New Approach to the Post-Mortem
Attorney-Client Privilege”, 82 Minn. L. Rev. 1329 (1998) at 1338.
73
See generally Kathryn W. Tate, The Hypothetical as a Tool for Teaching the Lawyer's Duty of
Confidentiality, 29 Loy. L.A. L. Rev. 1659 (1996).
26
Professional Ethics – Client Attorney Privilege
may be able in some instances to compel disclosure of a client's conversations with an
attorney when suing the attorney over a matter in which he or she represented the client,
or, according to a recently established rule, when the third party is the executive branch
of the government, seeking to compel disclosure of communications made to government
attorneys. Each of these exceptions is justifiable in light of the utilitarian justification for
the privilege, either because it allows the client to retain some measure of control over the
release of confidential information, or because it operates on communications that lie
outside the scope of proper attorney-client communications.
1. Waiver
The attorney-client privilege may be waived by client consent. For a waiver to be valid,
the client must waive the privilege knowingly and intelligently. The existence of waiver
authority does not threaten clients' willingness to disclose, and thus does not undermine
the attorney-client privilege; it is simply an outgrowth of the rule that the privilege
belongs to the client. While there are limitations on clients' ability to dictate the scope of
waiver, in general the client dictates which information is privileged and which is
revealed.75
2. The Crime-Fraud Exception76
Generally speaking, "[a] client who has sought assistance for the purpose of committing a
crime or fraud...cannot require secrecy." The "crime or fraud" exception to the attorneyclient privilege operates when a client reveals an intention to commit an act proscribed by
law to his or her attorney, or when a client takes advantage of legal advice to advance a
fraudulent or criminal plan. The exception generally does not apply to past wrongdoings
that a client reveals to an attorney.77
74
Supra n.erick at 1339.
See generally Geoffrey C. Hazard, Jr. et al., The Law and Ethics of Lawyering 271-72 (2d ed.
1994) (discussing waiver). According to one commentator, courts "frequently circumvent [the
privilege]" after the death of the client by finding that the client waived the privilege. Denise P.
Lindberg, “The Accountant-Client Privilege: Does It and Should It Survive the Death of the
Client?”, 1987 BYU L. Rev. 1271, 1276 (1987) (referring to the attorney-client privilege).
76
See generally Peter Murphy, Murphy on Evidence, 5th edn., Universal Law Publishing Co. Pvt.
Ltd.: Delhi, 1997, p.396.
77
David J. Fried, Too High a Price for Truth: The Exception to the Attorney-Client Privilege for
Contemplated Crimes and Frauds, 64 N.C. L. Rev. 443, 443 (1986); see also Ann M. St. Peter75
27
Professional Ethics – Client Attorney Privilege
The crime-fraud exception is based on the notion that communications made in
furtherance of an illegal purpose do not fall within the purview of the attorney-client
relationship, because it is not part of an attorney's professional role to further illegal
activity.78 No attorney-client privilege can ever exist for such communications, because
the privilege only applies to communications made for the purpose of obtaining legal
counsel from an attorney acting in a professional capacity.
The crime-fraud exception presents vexing procedural issues. Courts have struggled to
create a method of applying the exception that balances the need to protect legitimately
privileged information with the need for access to communications made in furtherance
of illegal activity. The problem lies in determining what quantity and what type of
evidence is needed to defeat the privilege. Generally speaking, a party seeking to invoke
the exception must make some initial showing of illegality, a burden sometimes
characterized as "some foundation in fact." A party seeking to compel disclosure via the
crime-fraud exception need not introduce independent evidence of illegality, but instead
may use the communications at issue as the basis for invoking the exception, provided
they introduce evidence supporting a reasonable belief that in camera review will uncover
evidence that establishes the exception's applicability.
3. The Testamentary Exception
Another, more limited exception abrogates the privilege after the death of the client for
the limited purpose of resolving disputes between persons claiming under the decedent's
estate. This "testamentary" exception is based on the notion that revealing information
needed to resolve such disputes effectuates the deceased client's wishes by ensuring that
assets are distributed according to his or her wishes. The privilege is not stripped away
entirely in such a scenario, however, because the communications are only discoverable
by persons with a legitimate stake in the deceased's property, and only in the case of a
dispute. Application of the testamentary exception, therefore, is in a sense controlled by
the client, since it depends on the client's wishes expressed prior to death.
Griffith, Abusing the Privilege: The Crime-Fraud Exception to Rule 501 of the Federal Rules of
Evidence, 48 U. Miami L. Rev. 259, 263 (1993) (stating that the exception "proscribes the
perpetuation of a crime or fraud under the pretext of privilege"). See generally Privileged
Communications, supra note 20, at 1509-14 (discussing the exception).
78
See generally Kathryn W. Tate, The Hypothetical as a Tool for Teaching the Lawyer's Duty of
Confidentiality, 29 Loy. L.A. L. Rev. 1659 (1996).
28
Professional Ethics – Client Attorney Privilege
4. The Attorney Self-Defense Exception
The attorney-client privilege also may not apply in suits against attorneys in which the
attorney must discuss client communications in order to present an adequate defense. The
self-defense exception, which arose in America in the 1800s, originally applied only "[to]
situations in which the attorney and client [were] in an adversarial posture." 79 It has since
been extended to include situations in which the attorney is sued or prosecuted by a third
party.80
Disclosure in attorney self-defense cases, at least in suits brought by third parties, has
disturbing implications. In the case of a suit brought by the client against the attorney, the
goal of the privilege is not likely to be undermined, because a client who feels that the
costs of disclosure outweigh the potential benefits of bringing a suit can simply avoid
disclosure by not bringing the suit. Suits brought by third parties, on the other hand, offer
the client no such option, and thus pose a risk of chilling client communications,
especially given the risk that a third party will bring a suit against an attorney as a pretext
for garnering information for use in a suit against the client.81 In principle, at least, the
danger posed by third-party lawsuits is minimized by the fact that courts limit the release
of privileged information to that which is "necessary" to the attorney's defense.
5. The "Government Entity" exception
The most recently established exception to the attorney-client privilege is closely related
to the crime-fraud exception. In a divided opinion, an US Eighth Circuit court recently
held that a White House official cannot invoke the privilege as to conversations with a
government attorney, at least in the context of a federal criminal investigation.82 The
decision rested primarily on the idea that the government's criminal justice needs
outweigh its own need for confidentiality, and that allowing officials to use their
government attorneys as a shield was a "misuse of public assets." Thus, the White House
79
Jennifer Cunningham, Note, Eliminating Backdoor Access to Client Confidences: Restricting
the Self-Defense Exception to the Attorney-Client Privilege, 65 N.Y.U. L. Rev. 992, 1009 (1990).
Traditionally, the rule operated "when an attorney was sued for malpractice...brought suit to
recover a fee, or...was charged with misconduct in the course of litigation between a client...and
another party." Id. at 1008 (footnotes omitted). In such cases the client was generally said to have
impliedly waived the privilege by making the accusations against the attorney. See id. at 1008-09.
80
Meyerhofer v. Empire Fire & Marine Ins. Co., 497 F.2d 1190 (2d Cir. 1974).
81
Supra Cunningham at 1021.
29
Professional Ethics – Client Attorney Privilege
attorneys, as employees of the federal government, could not assert the privilege in the
face of requests for disclosure by agents of that same government. 83 This principle is
supported in English law as well.84
82
See In re Grand Jury Subpoena Duces Tecum, 112 F.3d 910, 915 (8th Cir. 1997).
Erick S. Ottoson, “COMMENT: Dead Man Talking: A New Approach to the Post-Mortem
Attorney-Client Privilege”, 82 Minn. L. Rev. 1329 (1998) at 1344.
84
See Phipson.
83
30
Professional Ethics – Client Attorney Privilege
In Conclusion: Ethical Duty v. Rule of Evidence
In conclusion we examine the delicate linkage between the canons of legal ethics and
rules of professional privilege.
Ethical rules define a category of information about a client, which may or may not have
been gained from the client, that the lawyer may not voluntary use or reveal. The
limitation is one that the profession has sought to impose on itself through legislative
enactment or judicial rule. The law of evidence, on the other hand, defines a category of
information that the lawyer has gained from his or her client and that no court may
compel him to reveal. Therefore functionally one can construct a difference between
ethically protected information and privileged information. The distinction is important
because only then can one distinguishes breaches of duty in regard to one type of
information from the other type.85
Much information that is ethically protected will not be privileged. On the other hand,
virtually all information considered privileged under rules of evidence will also be
ethically protected. A lawyer whom a court orders to reveal information that is ethically
protected but not privileged under rules of evidence will be required to reveal the
information under threat of contempt but if that lawyer had voluntarily revealed the same
information before the court then he might have been guilty of professional misconduct
under Section 35 of the Advocates Act.
This area is unexplored in the Indian legal system but there is, however, the U.S 5th
circuit court decision in Brennan’s Inc. v. Brennan’s Restaurant86 to consider. In this
case the court resisted an effort to extend an exception to a privilege to being an
exception to the ethical duty. The court held, “..the ethical duty is broader than the
evidentiary privilege. The ethical precept, unlike the evidentiary privilege, exists without
regard to the nature or source of information or the fact that the others share the
knowledge.”
The point we seek to underscore is that an Indian lawyer must not reveal confidential
information received from a client merely under the assurance that it is not professionally
85
Stephen Gillers, Regulation of Lawyers: Problems of Law and Ethics, 3rd edn., Little, Brown
and Co.:Boston, 1992, p.17.
86
590 F.2d 168, 172 (5th Cir. 1979).
31
Professional Ethics – Client Attorney Privilege
privileged since the information could be ethically protected. The lawyer may be
confronted with a allegation of misconduct.
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Professional Ethics – Client Attorney Privilege
Bibliography
Articles



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







Denise P. Lindberg, “The Accountant-Client Privilege: Does It and Should It Survive
the Death of the Client?”, 1987 BYU L. Rev. 1271 (1987).
Erick S. Ottoson, “COMMENT: Dead Man Talking: A New Approach to the PostMortem Attorney-Client Privilege”, 82 Minn. L. Rev. 1329 (1998).
Eve Spangler, “Lawyers For Hire”, Salaried Professionals at Work 78 (1986).
Fried, “The Lawyer as a Friend: The Moral Foundations of the Attorney-Client
Relation”, 85 Yale LJ 1060 (1976).
Hazard, “An Historical Perspective on the Attorney Client Privilege, 66 Calif.L.Rev
1061 (1978).
Jennifer Cunningham, Note, Eliminating Backdoor Access to Client Confidences:
Restricting the Self-Defense Exception to the Attorney-Client Privilege, 65 N.Y.U. L.
Rev. 992 (1990).
John E. Sexton, A Post-Upjohn Consideration of the Corporate Attorney-Client
Privilege, 57 N.Y.U.L. Rev. 443 (1982)
Note, “Attorney-Client and Work Product Protection in a Utilitarian World: An
Argument for Recomparison”, 108 Harv. L. Rev. 1697, 1699 (1995).
Note, “The Attorney-Client Privilege and the Corporate Client: Where Do We Go
After Upjohn?” 81 Mich L. Rev. 665 (1983).
Sara A. Corello, “Note, In-House Counsel's Right to Sue for Retaliatory Discharge”,
92 Colum. L. Rev. 389 (1992)
Sara A. Corello, Note, In-House Counsel's Right to Sue for Retaliatory Discharge, 92
Colum. L. Rev. 389 (1992)
Stephen A. Saltzburg, The Federal Rules of Evidence: Corporate and Related
Attorney-Client Privilege Claims: A Suggested Approach, 12 Hofstra L. Rev. 279
(1984).
Stephen Charles, “Legal Professional Privilege: Continued Erosion”, 57 Law Inst. J.
832 (1983)
Books

Edward W.Cleary et al, McCormick on Evidence, 3rd edn., West Publishing Co:
Minnesota, 1984.
33
Professional Ethics – Client Attorney Privilege







Geoffrey C. Hazard Jr. and Susan P.Koniak, The Law and Ethics of Lawyering, The
Foundation Press Inc.: New York, 1990.
Gopi Nath (ed), Woodroffe & Amir Ali’s Law of Evidence, Vol. 4, 16th edn., The Law
Book Company (P) Ltd.: Allahabad, 1996.
M.N.Howard et al, Phipson on Evidence, 14th edn., Sweet and Maxwell: London,
1990, p.504.
Peter Murphy, Murphy on Evidence, 5th edn., Universal Law Publishing Co. Pvt. Ltd.:
Delhi, 1997.
Rubert Boss et al, An Outline of the Law of Evidence, 4th edn., Butterworths: London,
1975.
Stephen Gillers, Regulation of Lawyers: Problems of Law and Ethics, 3rd edn., Little,
Brown and Co.:Boston, 1992.
Y.V Chandrachud et al (ed), Ratanlal & Dhirajlal’s Law of Evidence, 19th edn.,
Wadhwa & Co.: Nagpur, 1997.
Miscellaneous





Black’s Law Dictionary, 17th Edition.
Commission Decision 85/79/EEC, 1985 O.J. (L 35) 58.
Commission Decision 88/589/EEC, 1988 O.J. (L 317) 47
Confidentiality of Legal Documents: Application of the Competition Rules Bill. EC
6-1983.
Council Regulation 17/62, 1962 O.J. Spec. Ed. 204, arts. 11 & 14
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34