Australia: Protecting in-house counsel legal advice in NSW

IN BRIEF

We at Swaab believe the recent case of Holman v Warringah Council [2015] brings some clarity to the law surrounding legal professional privilege, especially when it comes to information prepared by in-house counsel.

The question is – in what circumstances can legal professional privilege be claimed over information prepared by in-house counsel?

What we have learned:

  • Ensure that your in-house counsel's contracts of employment clearly reflect their duties and obligations as a legal practitioner, and that internal and external communications do not misrepresent their role as legal practitioners.
  • An in-house counsel's communications may not be privileged whilst they are operating in a non-legal capacity within an organisation.
  • A claim for privilege under section 118 of the Evidence Act will also not succeed if the communication is from a staff member of the 'legal services' department if that person does not hold a practicing certificate or is not subject to an employment contract permitting that person to provide legal advice.

Let's consider the facts:

John Holman considered that Warringah Council (Council) was liable for damage relating to stormwater drainage on his property. Mr Holman and Council exchanged correspondence in relation to this issue from 2008 - 2014.

In 2012, following a letter of demand from Mr Holman, Council sought legal advice from both external and in-house lawyers in respect of the issues raised by Mr Holman.

Mr Holman later applied to Council under the Government Information (Public Access) Act 2009 (GIPA) seeking access to documents held by Council in relation to the stormwater arrangements affecting his property. Council granted partial access on the grounds that some of the documents requested were subject to legal professional privilege.

Following several internal reviews and investigations from the Information Commissioner, Council continued to affirm its original decision citing clause 5 of Schedule 1 to the GIPA relating to legal professional privilege.

This final decision was challenged in the NSW Civil and Administrative Tribunal (Tribunal) on 25 February 2015.

Tribunal Ruling:

On 19 October 2015, the Tribunal slightly varied Council's decision, holding that the vast majority of the requested documents were subject to legal professional privilege.

The Tribunal found that because Council sought legal advice from in-house counsel and an external solicitor as a direct result of the concerns raised by Mr Holman, the documents were intentionally created with privileged status.

Council's in-house legal counsel both held practising certificates and their contracts of employment referred to their independence as legal advisors. Their employment contracts also recognised that they owed a paramount duty to the Court over the Council when acting as a Legal Practitioner.

The Tribunal found that section 118 and/or 119 of the Evidence Act 1995 (Evidence Act) applied to the documents the subject of the proceedings, except for one document which was not privileged as it involved communications from a Council employee within a 'legal services' department who did not hold a practising certificate.

The conclusive presumption against disclosure activated for all remaining documents because they were prepared on a confidential basis 'in the knowledge that a formal legal claim would probably be forthcoming and, later, that litigation was likely to ensue'.

Legal Procedure involving legal professional privilege:

When governments seek to establish legal professional privilege in a GIPA context, the following steps should be followed:

  1.  
Is there a presumption in favour of disclosure?                                                          
Yes.There is a presumption in favour of the disclosure of government information unless there is an overriding public interest against disclosure (s 5 GIPA).                                                                                                                              
 
  1.  
Is there an overriding public interest?
Client legal privilege (legal professional privilege) is one such overriding public interest (cl 5, Sch 1 to GIPA).

See Schedule 1 to GIPA and section 14 GIPA for other valid types of government information and public interest considerations.

 
  1.  
Does the 'balancing test' apply?
An 'overriding public interest against disclosure' only exists if the public interest considerations against disclosure outweigh those considerations in favour of disclosure (s 13 GIPA).

This balancing test does not apply to client privilege as covered by Schedule 1, clause 5 GIPA (see [90]).

 
  1.  
Is it appropriate to waive legal professional privilege?
An agency must consider whether it is appropriate to waive legal professional privilege before refusing access to the information (cl 5(2) of Sch 1 to GIPA).

Once privilege is waived, it is waived as against all persons not just the person who sought information under the GIPA.

Therefore waiving privilege may have far-reaching consequences that should be considered prior to a decision being reached.

Personal factors of the application may also be considered (s 55 GIPA).

 
  1.  
Does legal professional privilege attach to correspondence with lawyers and legal advice                                                                           ?
The conclusive presumption against disclosure operates if sections 118 or 119 of the Evidence Act apply:
  1. Section 118 prevents the disclosure of confidential information prepared for the dominant purpose of the lawyer/s providing legal advice to the client.
  2. Section 119 prevents the disclosure of confidential communications or information prepared for the dominant purpose of the client being provided with professional legal services relating to court proceedings (including anticipated or pending proceedings) where the client is a party to such proceedings.
There is a two-step process to applying sections 118 and 119:
  1. First, the communication must meet the requirements set out in section 118 or section 119, or in both sections.
  2. Second, the decision maker must be satisfied that production of the document would result in the disclosure of a confidential communication or of the confidential contents of a document (see In the matter of Southland Coal Pty Ltd (receivers and managers appointed) (in Liq) [2006] NSWSC 899 at [14]; Tribunal at [85])
  1.  
Does legal professional privilege attach to advice provided by in-house counsel?
In-house lawyers are entitled to claim privilege on behalf of their employer as a client (see definition of 'client' in s 117 of Evidence Act and Sydney Airports Corporation Ltd v Singapore Airlines Ltd [2005] NSWCA 47).

This is subject to the caveat that in-house lawyers also have other functions, and that privilege does not attach to information that does not satisfy the requirements of sections 118-119 of the Evidence Act.

 
  1.  
Does legal professional privilege attach to communications from non-lawyers?
Where non-lawyers assist to create documents and communications in connection with the preparation of confidential information for the purpose of litigation or legal advice, privilege still attaches under section 119 of the Evidence Act.

If documentation or communications are not just prepared in the ordinary course of business and would not have come into existence unless the current or anticipated proceedings existed, then privilege is also likely to attach.

 

For further information, please contact:

Chris Shaw, Partner
Phone: +61 2 9233 5544
Email: chs@swaab.com.au

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on Mondaq.com.

Click to Login as an existing user or Register so you can print this article.

Authors
 
Some comments from our readers…
“The articles are extremely timely and highly applicable”
“I often find critical information not available elsewhere”
“As in-house counsel, Mondaq’s service is of great value”

Mondaq Advice Centre (MACs)
Related Video
Up-coming Events Search
Tools
Print
Font Size:
Translation
Channels
Mondaq on Twitter
 
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
 
Email Address
Company Name
Password
Confirm Password
Mondaq Topics -- Select your Interests
 Accounting
 Anti-trust
 Commercial
 Consumer
 Criminal
 Employment
 Energy
 Environment
 Family
 Finance
 Government
 Healthcare
 Immigration
 Insolvency
 Insurance
 International
 IP
 Law Performance
 Law Practice
 Litigation
 Media & IT
 Privacy
 Real Estate
 Strategy
 Tax
 Technology
 Transport
 Wealth Mgt
Regions
Africa
Asia
Asia Pacific
Australasia
Canada
Caribbean
Europe
European Union
Latin America
Middle East
U.K.
United States
Worldwide Updates
Check to state you have read and
agree to our Terms and Conditions

Terms & Conditions and Privacy Statement

Mondaq.com (the Website) is owned and managed by Mondaq Ltd and as a user you are granted a non-exclusive, revocable license to access the Website under its terms and conditions of use. Your use of the Website constitutes your agreement to the following terms and conditions of use. Mondaq Ltd may terminate your use of the Website if you are in breach of these terms and conditions or if Mondaq Ltd decides to terminate your license of use for whatever reason.

Use of www.mondaq.com

You may use the Website but are required to register as a user if you wish to read the full text of the content and articles available (the Content). You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these terms & conditions or with the prior written consent of Mondaq Ltd. You may not use electronic or other means to extract details or information about Mondaq.com’s content, users or contributors in order to offer them any services or products which compete directly or indirectly with Mondaq Ltd’s services and products.

Disclaimer

Mondaq Ltd and/or its respective suppliers make no representations about the suitability of the information contained in the documents and related graphics published on this server for any purpose. All such documents and related graphics are provided "as is" without warranty of any kind. Mondaq Ltd and/or its respective suppliers hereby disclaim all warranties and conditions with regard to this information, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. In no event shall Mondaq Ltd and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use or performance of information available from this server.

The documents and related graphics published on this server could include technical inaccuracies or typographical errors. Changes are periodically added to the information herein. Mondaq Ltd and/or its respective suppliers may make improvements and/or changes in the product(s) and/or the program(s) described herein at any time.

Registration

Mondaq Ltd requires you to register and provide information that personally identifies you, including what sort of information you are interested in, for three primary purposes:

  • To allow you to personalize the Mondaq websites you are visiting.
  • To enable features such as password reminder, newsletter alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our information providers who provide information free for your use.

Mondaq (and its affiliate sites) do not sell or provide your details to third parties other than information providers. The reason we provide our information providers with this information is so that they can measure the response their articles are receiving and provide you with information about their products and services.

If you do not want us to provide your name and email address you may opt out by clicking here .

If you do not wish to receive any future announcements of products and services offered by Mondaq by clicking here .

Information Collection and Use

We require site users to register with Mondaq (and its affiliate sites) to view the free information on the site. We also collect information from our users at several different points on the websites: this is so that we can customise the sites according to individual usage, provide 'session-aware' functionality, and ensure that content is acquired and developed appropriately. This gives us an overall picture of our user profiles, which in turn shows to our Editorial Contributors the type of person they are reaching by posting articles on Mondaq (and its affiliate sites) – meaning more free content for registered users.

We are only able to provide the material on the Mondaq (and its affiliate sites) site free to site visitors because we can pass on information about the pages that users are viewing and the personal information users provide to us (e.g. email addresses) to reputable contributing firms such as law firms who author those pages. We do not sell or rent information to anyone else other than the authors of those pages, who may change from time to time. Should you wish us not to disclose your details to any of these parties, please tick the box above or tick the box marked "Opt out of Registration Information Disclosure" on the Your Profile page. We and our author organisations may only contact you via email or other means if you allow us to do so. Users can opt out of contact when they register on the site, or send an email to unsubscribe@mondaq.com with “no disclosure” in the subject heading

Mondaq News Alerts

In order to receive Mondaq News Alerts, users have to complete a separate registration form. This is a personalised service where users choose regions and topics of interest and we send it only to those users who have requested it. Users can stop receiving these Alerts by going to the Mondaq News Alerts page and deselecting all interest areas. In the same way users can amend their personal preferences to add or remove subject areas.

Cookies

A cookie is a small text file written to a user’s hard drive that contains an identifying user number. The cookies do not contain any personal information about users. We use the cookie so users do not have to log in every time they use the service and the cookie will automatically expire if you do not visit the Mondaq website (or its affiliate sites) for 12 months. We also use the cookie to personalise a user's experience of the site (for example to show information specific to a user's region). As the Mondaq sites are fully personalised and cookies are essential to its core technology the site will function unpredictably with browsers that do not support cookies - or where cookies are disabled (in these circumstances we advise you to attempt to locate the information you require elsewhere on the web). However if you are concerned about the presence of a Mondaq cookie on your machine you can also choose to expire the cookie immediately (remove it) by selecting the 'Log Off' menu option as the last thing you do when you use the site.

Some of our business partners may use cookies on our site (for example, advertisers). However, we have no access to or control over these cookies and we are not aware of any at present that do so.

Log Files

We use IP addresses to analyse trends, administer the site, track movement, and gather broad demographic information for aggregate use. IP addresses are not linked to personally identifiable information.

Links

This web site contains links to other sites. Please be aware that Mondaq (or its affiliate sites) are not responsible for the privacy practices of such other sites. We encourage our users to be aware when they leave our site and to read the privacy statements of these third party sites. This privacy statement applies solely to information collected by this Web site.

Surveys & Contests

From time-to-time our site requests information from users via surveys or contests. Participation in these surveys or contests is completely voluntary and the user therefore has a choice whether or not to disclose any information requested. Information requested may include contact information (such as name and delivery address), and demographic information (such as postcode, age level). Contact information will be used to notify the winners and award prizes. Survey information will be used for purposes of monitoring or improving the functionality of the site.

Mail-A-Friend

If a user elects to use our referral service for informing a friend about our site, we ask them for the friend’s name and email address. Mondaq stores this information and may contact the friend to invite them to register with Mondaq, but they will not be contacted more than once. The friend may contact Mondaq to request the removal of this information from our database.

Security

This website takes every reasonable precaution to protect our users’ information. When users submit sensitive information via the website, your information is protected using firewalls and other security technology. If you have any questions about the security at our website, you can send an email to webmaster@mondaq.com.

Correcting/Updating Personal Information

If a user’s personally identifiable information changes (such as postcode), or if a user no longer desires our service, we will endeavour to provide a way to correct, update or remove that user’s personal data provided to us. This can usually be done at the “Your Profile” page or by sending an email to EditorialAdvisor@mondaq.com.

Notification of Changes

If we decide to change our Terms & Conditions or Privacy Policy, we will post those changes on our site so our users are always aware of what information we collect, how we use it, and under what circumstances, if any, we disclose it. If at any point we decide to use personally identifiable information in a manner different from that stated at the time it was collected, we will notify users by way of an email. Users will have a choice as to whether or not we use their information in this different manner. We will use information in accordance with the privacy policy under which the information was collected.

How to contact Mondaq

You can contact us with comments or queries at enquiries@mondaq.com.

If for some reason you believe Mondaq Ltd. has not adhered to these principles, please notify us by e-mail at problems@mondaq.com and we will use commercially reasonable efforts to determine and correct the problem promptly.