What is Legal Professional Privilege?
Legal professional privilege (‘LPP‘) is an immunity from compulsory disclosure, and often arises during processes such as discovery and interlocutory disputes. The immunity can be invoked for materials exchanged between lawyer and client (and sometimes a third party) produced for the dominant purpose of providing or obtaining legal advice. However, the privilege can be waived if one party commits an action which is expressly, or impliedly, inconsistent with the maintenance of confidentiality.
Background to Glencore International AG v Federal Commissioner of Taxation (2019) 265 CLR 646 (‘Glencore‘)
On 14 August 2019, the High Court handed down a unanimous decision clarifying the role of LPP after large-scale data breaches resulted in the leak of documents claimed to be subject to immunity in the ‘Paradise Papers’ leak of 2017. The plaintiff Glencore companies sought an injunction, claiming an actionable legal right to the return of the documents under LPP alone.
The High Court’s Judgment
In a unanimous decision, the High Court clarified that where documents subject to LPP are already within the possession of the defendant, LPP cannot be relied upon as an actionable right to injunctive relief i.e. LPP cannot be used as a sword to bring a cause of action against another party.
In doing so, the High Court emphasised that LPP is not merely an aspect of procedure or a rule of evidence. It is a substantive right founded on a matter of public interest, being the facilitation of representation of clients by legal advisers. The potential conflict of this interest with the fair conduct of litigation was cited as justifying the restriction of LPP to within strict limits, stressing that LPP can only be used as a shield.
The Court noted that in circumstances where privileged communications had already been disclosed, an alternative basis for relief lay in equity to restrain an apprehended breach of confidentiality. This relies on the confidentiality of the information in a legal sense, and not on LPP itself. Although confidentiality is a matter of fact and discretion in each case, the Court clarified that “it is necessary for an equity to arise that the person to be restrained must have an obligation of conscience”.
Finally, the High Court stressed that any perceived gap in the law could not be addressed through the development of the common law, emphasising the importance of following settled principles to maintain a coherent body of law.
Implications
The High Court’s comments indicate a gap in the law surrounding document privilege in light of a growing threat of data breaches. So long as law firms continue to store confidential documents in online databases, fears arise that the absence of an actionable right to injunctive relief in the wake of data breaches may prevent open client communication and render the law firm data a larger target for cybercrimes.
A statutory cause of action appears to be the best way to close this gap, given the High Court’s reluctance to do so. However, in the meantime, it is crucial for firms and practitioners to carefully review and prioritise their data storage systems and security in order to uphold the interests of providing effective legal advice and services.
How We Can Help
A copy of the full judgment can be found here.
If you require any advice on LPP or breach of confidence, including if you have a potential claim or have a claim made against you, please do not hesitate to contact us at admin@valorumlaw.com.au or voregan@valorumlaw.com.au. Our expert lawyers will be on hand to assist you.
The information contained in this article is general information only and not legal advice. The currency, accuracy and completeness of this article (and its contents) should be checked by obtaining independent legal advice before you take any action or otherwise rely upon its contents in any way.
Contributors: Valentina O’Regan, Harry Chen
