A recent judgment handed by the High Court of the United Kingdom, provides useful guidance on the extent of legal advice privilege in the context of regulatory investigations. The judgment which was handed by the High Court in the recent case of Property Alliance Group Limited v The Royal Bank of Scotland Plc [2015] EWHC 3187 (Ch),confirmed the well known principle established in the case of Balabel v Air India [1988] 1 Ch 317 that legal advice is not confined to telling the client the law; it must include advice as to what should prudently and sensibly be done in the relevant legal context.
The High Court upheld RBS’s entitlement to claim legal advice privilege over two types of documents which were produced by the external lawyers of RBS, namely Clifford Chance, for meetings with an executive committee within the bank, being the Executive Steering Group, with oversight of the LIBOR regulatory investigations.
Facts
PAG sued RBS for alleged misrepresentations in relation to LIBOR in connection with interest rate swaps sold to it by RBS.The LIBOR scandal had prompted different regulators from different jurisdictions to commence regulatory investigations against RBS. As a result RBS established the Committee Executive Steering Group to oversee those investigations and any related litigation. PAG requested the disclosure of two sets of documents that had been prepared by the external lawyers of RBS, Clifford Chance, for the benefit of assisting the Executive Steering Group in relation to the investigations. However RBS objected to the disclosure of such documents on the grounds that the documents prepared by the external lawyers Clifford Chance for the RBS Executive Steering Group were privileged.
The two set of documents consisted of the two following:
(a) Confidential tables prepared by Clifford Chance, which informed and updated the Executive Steering Group on the progress, status and issues arising from the regulatory investigations; and
(b) Confidential summaries/notes drafted by Clifford Chance, concerning the discussions between the ESG and its legal advisers at the ESG meetings.
On numerous occasions, ESG held meetings led by Clifford Chance, in order to discuss the status of the investigations whereby Clifford Chance had provided advice on the issued but also the next steps.
Judgment
The Judge relied on the case of Three Rivers (No.6) and was satisfied that Clifford Chance as the creators of the two sets of documents, were engaged by RBS in “a relevant legal context” and that both sets of documents formed part of a “continuum of communication and meetings” between RBS and Clifford Chance. The first set of documents aimed to keep ESG informed whilst the second set of documents provided a comprehensive and up to date summary of developments in the regulatory investigations. The lawyers were not providing services to ESG as a matter of “administrative convenience”, but as an “integral part of their provision of legal advice and assistance to the ESG.”
What is crucial to underline is the fact that the judge emphasized that factual documents will not attract privilege simply because they were prepared by a lawyer, who was present at a meeting. What should be stressed is whether the documents were created in connection with the provision of legal advice, as was in the particular case.
For further information on this topic please contact
Ms. Nada Starovlah (nstarovlah@pittaslegal.com) at SOTERIS PITTAS & CO LLC,
by telephone (+357 25 028460) or by fax (+357 25 028461)
