The concept of legal privilege arises from 19th century case law. At its very core, it maintains the principle that every person is entitled to legal advice on their position from a professional advisor, and that this should remain confidential. Addleshaw Goddard’s Sally Emerton looks at its role in the digital era.

The principle of legal privilege applies as much to a body corporate as it does to an individual. A business may require advice on an area of concern and wants to mitigate the risk that such information will later be used against it.

In the digital age where information is instantaneously available and can be shared at the click of a button, how do you ensure that your privilege is preserved? Can you imagine a situation where a private email you have sent ends up in the possession of your opponent who use against you in Court proceedings? Legal privilege includes the following:

Legal Professional Privilege:

Legal Advice Privilege, and

Litigation Privilege

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By GlobalData

Without Prejudice Privilege

Legal advice privilege protects confidential communications between a lawyer and client where the lawyer is acting in the course of their professional relationship and within the scope of his professional duties for the purposes of seeking or giving legal advice and assistance in a relevant legal context.

Litigation privilege protects confidential communications between a lawyer and client, and between either of them and a third party for the dominant purpose of fighting adversarial proceedings either in existence or in reasonable contemplation. Key points are:

Both legal advice and litigation privilege have confidentiality as a key requirement to maintain privilege.

Legal advice privilege applies between a lawyer and a client only. Advice from other professional advisors (such as accountants) will not attract privilege.

A ‘client’ in a body corporate must be a clearly identified select team capable of receiving legal advice. Not all communications between a lawyer and an employee of a business are protected by legal advice privilege.

Internal investigations may not have the protection of legal advice privilege, and will not have the protection of litigation privilege if they are made before there is contemplation of adversarial proceedings.

For litigation privilege to apply, the communication’s dominant purpose must be to fight adversarial proceedings either in existence or in reasonable contemplation.

The question of privilege has been explored in a number of Court decisions recently. These include:

The RBS Rights Issue Litigation which considered legal advice privilege and without prejudice privilege;

Property Alliance Group Ltd v Royal Bank of Scotland Plc which resulted in six decisions on privilege in 2015 alone; and

Dawson Damer & Others v Taylor Wessing which confirmed that information not protected by privilege must be provided under a valid Data Subject Access Request (DSAR), even when it is known that the purpose of the DSAR is to obtain documentation to use in litigation.

Property Alliance Group Ltd v Royal Bank of Scotland [2015] EWHC 3341

Looking at one Court decision from the Property Alliance Group Ltd (PAG) v Royal Bank of Scotland Plc (RBS) litigation, it is clear the Courts are having to increasingly balance litigants’ competing interests.

RBS was defending a claim brought by PAG under a number of heads, including allegations that PAG had been mis-sold
swap contracts.

Prior to issuing the claim, PAG’s MD arranged separate meetings with former RBS employees who were employed when PAG entered into Libor ‘swaps’.

The MD invited the former employees to the meeting on the basis he wanted to establish a business relationship between PAG and the employees’ new businesses. His real motivation was to seek assistance for his claim against RBS. He secretly recorded the meetings. The employees, when later approached, refused to assist PAG.

RBS became aware of the recordings when an email referring to the meetings was inadvertently disclosed by PAG’s lawyers. RBS brought an application to use the recordings and emails in the litigation. PAG defended the application on the grounds that the recordings and emails were subject to litigation privilege, being documents brought into existence for the dominant purpose of fighting
adversarial proceedings. The Court held:

Objectively, the meeting’s dominant purpose from the PAG MD’s perspective was to obtain evidence for use in the litigation.

The dominant purpose from the ex-RBS employees’ perspective was to discuss future business opportunities.

There were “two clear but entirely divergent purposes”.

The Court allowed RBS to use the privileged recordings and emails, on the basis the PAG MD had “actively deceived” the ex-RBS employees. The “fair and correct” way was to assess the dominant purpose of the meeting from the perspective of the deceived party.

Top tips to protect privilege


Ensure any engagement letters mention potential litigation or a potential dispute.

Think ‘dispute’ at an early stage – even at complaint or investigation stage.

Define the purpose of documents and communications.

Mark documents “in contemplation of legal proceedings”;

Protect non-privileged documents by excluding advice or making it easy
to redact.

Keep privileged documents in a separate file or electronic folder, including locking away confidential papers on an evening and requesting IT to set up secure ‘access only’ electronic files.

Ensure any client relationships with third-party advisers are properly documented, recording duties of confidentiality.

Act quickly if you learn that privileged documents are in the possession of a party who should not have them.

Educate the business on the use of ‘without prejudice’, which protects communications which are a genuine attempt to settle a dispute.


Assume that marking documents ‘privileged’ will make them privileged.

Allow people to produce their own notes of sensitive or contentious issues (for instance, board minutes) without first consulting in-house or external lawyers.

Allow privileged emails to be circulated around the business by email.

Allow the business to conduct internal audits or investigations without considering whether they should be managed or supervised by an in-house or
external lawyer