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Case law: Court clarifies when information obtained in internal investigations at work is not protected by legal advice privilege

Businesses carrying out internal investigations should check whether the results of the investigations are protected by legal advice privilege, and do not have to be disclosed to the other side in legal proceedings, following a recent ruling.

Legal Alert

This update was published in Legal Alert - February 2017

Legal Alert is a monthly checklist from Atom Content Marketing highlighting new and pending laws, regulations, codes of practice and rulings that could have an impact on your business.

Bank shareholders went to court to recover losses following a rights issue of the bank's shares. As part of the proceedings they asked to see summary transcripts, notes and other records of 124 internal interviews by the bank, carried out as part of two internal investigations aimed at gathering information to help the bank take legal advice from external lawyers. Interviewees had been told by the bank that what they said would be confidential and protected by 'attorney-client privilege'.

Under English law, confidential communication between clients and lawyers for the purpose of giving or receiving legal advice, is privileged.

The bank argued that the interview records were protected by legal advice privilege because each recorded 'a communication between a lawyer and a person authorised by [the bank] to give instructions to its lawyers, and that as such those communications are privileged'.

The bank did not claim that the notes were part of a communication in which the bank asked for or was given legal advice by its lawyers, or that the interviewees were given legal advice. However, it said that any communication with their employer's lawyers by a duly authorised employee seeking or receiving legal advice, is privileged, even if the communication is only factual information and does not consist of legal instructions.

The shareholders argued that 'gathering and communication of information by a person who is not the client is not protected by privilege, even if the information is gathered and communicated by that person to his employer's lawyer with the authority and at the request of the client and/or its lawyers, and even if the client is that person's employer'.

The court agreed with the shareholders. It said the 'client' in this case could only be employees authorised by the bank to seek and receive legal advice from its lawyers. That did not include information obtained from employees and former employees to be placed before the bank's lawyers. The interviewees had given the information as employees and not as clients.

Operative date

  • Now

Recommendation

  • Employers carrying out internal investigations should carefully check whether the information obtained is protected by legal advice privilege, or risk it being available to the other side in subsequent litigation

Case ref: RBS Rights Issue Litigation, Re [2016] EWHC 3161

Disclaimer: This article from Atom Content Marketing is for general guidance only, for businesses in the United Kingdom governed by the laws of England. Atom Content Marketing, expert contributors and ICAEW (as distributor) disclaim all liability for any errors or omissions.