The recent decision in State of Qatar v Banque Havilland SA yet again highlights the difficulties that remain when a party tries to assert litigation privilege over documents that have been created for more than one purpose. In this article, we provide a brief refresher of the key requirements where a party wishes to assert litigation privilege to avoid disclosure of a document. We also consider the implications of the Qatar decision and conclude with a checklist of points to bear in mind in the context of investigations.

Privilege refresher

There are two main types of privilege that might attach to communications between solicitors and clients. They are:

  1. legal advice privilege
  2. litigation privilege.

Legal advice privilege extends to confidential communications between clients and their lawyers where the dominant purpose was obtaining legal advice. This was most recently considered in the case that we considered in more detail in Privilege and the challenges of email. It does not extend to communications with third parties.

By contrast, litigation privilege can extend to communications with third parties, but only subject to certain conditions. Documents are protected by litigation privilege if they satisfy all of the following requirements as set out in Three Rivers No.6:

  • they are confidential communications
  • between a lawyer and a client, or between a lawyer / client and a third party
  • where the communication was made for the dominant purpose of litigation which is either pending, reasonably contemplated, or existing
  • the litigation must be adversarial, not investigative or inquisitorial

The Qatar case

The Qatar  case involves allegations of a conspiracy between the defendant Banque Havilland ("BH") and several Saudi Arabian and UEA banks to manipulate financial markets in Qatar. The background to Qatar's claim involves the documents (in particular, a presentation) which had been allegedly prepared by BH. Those documents were leaked and published in 2017. Following the publication, BH commissioned a forensic report by PricewaterhouseCoopers and the report was issued by PwC in June 2018.  The report was shared with various regulators under a limited waiver.

Qatar issued a claim against BH in April 2019 and, following the parties giving disclosure in January 2021, sought an order from the court compelling BH to disclose a copy of the report issued by PwC. 

Claim to litigation privilege

BH resisted disclosure of the report on the basis that it was protected by litigation privilege. It asserted litigation privilege on the grounds that:

  • the report was commissioned at a time when adversarial proceedings were reasonably in contemplation
  • the report was prepared for the sole purpose of collecting evidence for the purpose of litigation
  • privilege had not been waived when the report was given to regulators, because it was given under a limited waiver

The decision

In his judgment, David Edwards QC did not agree that the PwC report was for the dominant purpose of litigation. In particular, the point in time at which PwC were instructed, litigation cannot have been "reasonably contemplated" by BH and the evidence provided little support that this was the case. A "mere possibility" of a claim by Qatar was not enough to assert litigation privilege (see USA v Philip Morris) and the judge did not agree that the regulatory investigations went beyond the investigative stage. Despite this, the judge noted that, if the report had been protected by litigation privilege, its disclosure to regulators under a limited waiver would not have waived that privilege.

Practice points checklist

When preparing documents and seeking advice from third parties in the context of investigations, parties should:

  • obtain legal advice as soon as possible to ensure issues of privilege are considered and identified at an early stage
  • identify and record, wherever possible, the purpose of investigations where they are contemplated for litigation
  • avoid wide circulation of email discussing matters and marking documents "privileged and confidential"
  • when instructing third parties, be clear on the scope and purpose of the instruction
  • when considering disclosure to a regulator or another third party, ensure that potentially privileged documents are provided under a limited waiver

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.