Legal Professional Privilege 1: Litigation Privilege
Introduction
The outcome of a case highly depends on the evidence available to substantiate your claim. The more cogent your evidence, the more likely the outcome will be in your favour.
Naturally, one of the important categories of evidence available is the communication with legal advisors and communication with third parties whose reports are relevant to the case.
To set the stage, it is important to understand that before a trial, your opponent and you are required to exchange all relevant documents of the suit (known as the process of ‘discovery’). This means that there are no surprises in a trial (contrary to what we see on TV).
Nothing should be hidden, no stone unturned and for good measure, since the point of a trial is to find the truth and the truth can only be found if all information is laid bare. A system of justice cannot function where a lack of information or deception forms part of its cogs. Machiavelli would weep.
However, the downside to this is that your opponent can shape their defence based on the documents you bring in to support your claim. For example, an internal forensic audit is made to snuff out suspected bad actors in your company. The information contained in this report would include detailed operations of your company as well as the detailed accounts of how the suspected bad actors manipulate. If this report is disclosed, it would immediately expose the extent of proof and strategy you would employ at a very early stage.
Thus, the above begs the question, how do we protect ourselves from such a case? In this regard, we introduce Legal Professional Privilege.
As a general rule, the category of evidence above is protected under what is called ‘Legal Professional Privilege’. This term describes both: 1) legal advice privilege; and 2) litigation privilege. This article will examine the latter.
What is litigation privilege?
Litigation privilege is simply protection on reports made by third parties on the instruction of a client or lawyer for the purpose of litigation.
How does litigation privilege apply in law?
At the outset we will lay down the law and its mechanism, after which we will explore its fundamental principles.
Our law on legal professional privilege is first and foremost statutory. Sections 126 to 129 of the Evidence Act 1950 (“EA 1950”) governs the extent of permissible disclosure of privileged communications. Although the abovementioned sections do not collectively express reference to litigation privilege, the common law does.
The Malaysian position is set out in the Court of Appeal case of Wang Han Lin (1). It provides a two-fold test to establish litigation privilege:
Whether litigation was pending or apprehended; and
Whether litigation was the dominant purpose for which the report was prepared.
Therefore, it is important that the party seeking this privilege must be aware of circumstances rendering litigation between itself and an opposing party a reasonable prospect. It is not enough that there were general apprehensions of future litigation nor is it sufficient that there may be a possibility that sooner or later someone might make a claim.
If the test above is satisfied, the Court will then consider whether the evidence is material to the case, meaning whether it plays a crucial role in the unfolding narrative of the case. The Court of Appeal in Wang confirmed this when it endorsed the part of the decision in Bukit Lenang (2) where it held that privilege will not accrue over material facts.
Motive behind the principles
The Court has a duty to balance the two seemingly competing principles to arrive at a decision that is just in the circumstances of a particular case. This is important to avoid the effect of privilege suppressing relevant evidence and adversely affecting the fair trial of the case.
After all, the Court’s primary objective here is to securely and effectively administer justice according to law. Lord Edmund-Davies in Waugh (3) gives a good rationale:
“... And in my judgment we should start from the basis that the public interest is, on balance, best served by rigidly confining within narrow limits the cases where material relevant to litigation may be lawfully withheld. Justice is better served by candour than by suppression. For, as it was put in Grant v Downs 135 CLR 674 at 686 majority judgment 'privilege... detracts from the fairness of the trial by denying a party access to relevant documents or at least subjecting him to surprise.”
Although it is important that parties to litigation, represented or not, must be left to prepare their contending positions in private, without adversarial interference and fear of premature disclosure, public interest demands that all relevant material should be available to Courts when deciding cases. Courts should not have to reach decisions in ignorance of the contents of documents or other material which, if disclosed, might well affect the outcome.
Litigation privilege in other jurisdictions
The Singapore Court of Appeal judgment in Skandinaviska Enskilda Banken AB (Publ), Singapore Branch v Asia Pacific Breweries (Singapore) Pte Ltd and Other Appeals [2007] SGCA 9 (“Skandinaviska”) also preserved litigation privilege as a matter of common law. The reasoning in Skandinaviska was an important consideration in Wang.
Other commonwealth jurisdictions such as Canada (4) , India (5) and Australia (6) have also come to similar conclusions. Suffice to say litigation privilege is a cornerstone of the adversarial system of litigation which is practiced in Malaysia. It takes its roots, as do the provisions of the EA 1950, from the English Common Law. The rationale for this privilege has been recognised as far back as 1884 in Bray’s seminal work on ‘discovery’:
“…whereas the ground on which a party is protected from disclosing his evidence [litigation privilege] is that the adversary may not be thus enabled so to shape his case as to defeat the ends of justice.”
Practical tips to preserve litigation privilege
Here are some practical tips to maximize the protection afforded by litigation privilege:
When a report/document is being created for the purpose of legal advice, make it clear that the purpose of this report is for legal advice and better yet for impending or existing litigation. The Court will examine the substance of the document to determine its dominant purpose. The clear labelling on the document will make it less ambiguous.
Instruct any experts whose reports will be used for legal advice through lawyers whenever possible. Where it is not practical to instruct lawyers yet, consider the style of communication to the experts that this instructions are being sought for the purpose of legal advice, or for the purpose of litigation, as the case may be.
Where possible, do not use the same document for multiple purposes. For example, any witness statements or expert reports should not be forwarded to non-relevant third parties or to anyone for other purposes. This may result in the privilege being lost as the dominant purpose is being diluted.
The sender should avoid (as far as possible) any written commentary on the advice/report itself as the commentary may not come under protection.
Finally it is important to understand that whether a document is privileged or not is a question of substance rather than form. Simply following the steps above cannot make a non-privileged document a privileged one.
Next we will go into more detail on how the Courts evaluate litigation privilege along with more comparison from relevant jurisdictions. Stay tuned!
Reference
(1) Wang Han Lin & Ors v HSBC Bank Malaysia Bhd [2017] 10 CLJ 111.
(2) Tenaga Nasional Bhd v Bukit Lenang Development Sdn Bhd [2016] 10 CLJ 164.
(3) Waugh v British Railways Board [1979] All ER 1169.
(4) Minister of Justice v Sheldon Blank [2006] SCC 39.
(5) Muchershaw Bezonji v The New Dhurumsey Spinning and Weaving Company (1880) 4 ILR Bom 576.
(6) Baker v Campbell (1983) 153 CLR 52.
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