2. Qualifications on duty to the client

A-G (NT) v Kearney (1985) 158 CLR 500*

It is not available if a client seeks legal advice in order to facilitate the commission of crime or fraud or civil offence (whether the adviser knows or does not know of the unlawful purpose)

O'Donovan v Vereker; O'Donovan v Forsyth (1987) 76 ALR 97*

Privilege can not be claimed for advice that goes to the promotion of an illegal act.  Barrister became involved in promoting tax avoidance scheme so there was no privilege (as opposed to simply providing advice on the legality of such a scheme)

Section 127 creates a privilege in respect of religious confessions.  (p430 UEL)

Section 128 creates a privilege against self-incrimination.  A witness can object in civil and criminal proceedings against giving evidence on the ground that it may tend to prove that the witness has committed an offence or is liable to a civil penalty.  However, section 187 provides that a corporation may not claim the self incrimination privilege.

3. Government and corporate lawyers

Farrow Mortgage Services Pty Ltd (in liqu) v Webb 39 NSWLR 601*

Question of joint privilege as, for example, in the case of joint directors. Where two or moie persons communicate with their legal advisor and certain communications attract Privilege, that Privilege 'belongs to all the persons who joined in seeking the advice. The privilege is a joint privilege.'

All to whom the Privilege 'belongs' must concur in its waiver.

Privilege attached to legal advice obtained by a company is not lost when the advice is disclosed to its directors - not because of their common interest but because the company can only 'function' by the " actions and declarations of human beings",

"Common interest is not in this context a rigidly defined concept. A mere common interest in the outcome of litigation will be sufficient to enable any party with that interest to rely on it."

A-G (NT) v Kearney (1985) 158 CLR 500

In circumstances where legal advice is given by an “in-house” legal adviser the privilege should only apply to advice given by such persons who are listed on a roll of legal practitioners and hold a current practising certificate in a State/Territory of Australia or work under the supervision of such a person.  Ultimately, any doubt as to whether or not a person is a legal adviser, subject to these guidelines, is a matter which may be decided by a Court

Waterford v The Commonwealth (1987) 61 ALJR 674

The majority of the Court had no difficulty in holding that “salaried” lawyers employed in government departments, especially the Crown Solicitor’s Office, were in the same position as solicitors or barristers in private practice, and as such their communications were subject to privilege if they contained legal advice.

Matters of policy and legal advice may be intermingled in the one document ...... The appellant’s submission fails to appreciate that the sole purpose test is a test that looks to the reason why the document was brought into existence. If its sole purpose was to seek or to give legal advice in relation to a matter, then the fact that it contains extraneous matter will not deny to it the protection of the privilege.

Grant v Downes (1976) 135 CLR 674

Citibank v FCT (1988) 88 ALR 144

On search warrant need time to be able to claim and argu privilege properly.

4. Confidential information

5. The Chinese Wall problem – conflicts of interest

Mallesons Stephen Jaques v KPMG Marwick (1990) 4 WAR 357

The Court " would restrain a solicitor from acting where there is a real and sensible possibility of confidential information being disclosed or used to the detriment of a former client".

Prince Jefri Bolkiah v KPMG [1999] 2 WLR 215

Subsequent to Prince Jefri’s dismissal as chairperson of the BIA, the Brunei Government commenced an investigation into the conduct of the affairs of the BIA, including the destination and present location of money which had been transferred from the BIA’s funds while Prince Jefri was the chairperson.  The Brunei Government sought to retain KPMG to assist in the investigation. KPMG took the view that it could accept the instructions because it had ceased to act for Prince Jefri more than two months previously; hence he was no longer a client. However, aware of the possibility of a conflict of interest because the investigation was likely to be adverse to Prince Jefri’s interests and the firm possessed confidential information relating to his financial affairs, the firm erected an information barrier.

Primary Disqualification It is settled law that a lawyer who has acquired relevant confidential information from a former client cannot subsequently act against that former client and is automatically disqualified

Secondary Disqualification After the initial disqualification of a lawyer, the court must decide whether to disqualify the lawyer's firm as well. Courts have often answered this question by using the presumption of imputed knowledge, which presumes that the disqualified lawyer shared the confidential information of the former client with the entire firm.  The onus is upon the firm to show that the relevant knowledge has not been transferred and that there is no risk that it will be.

While common law jurisdictions have agreed that the former client's confidential information should not be put at risk, they have been divided over how strict this standard should be.  The court should intervene unless it is satisfied that there is no risk of disclosure. It goes without saying that the risk must to a real one, and not merely fanciful or theoretical. But it need not be substantial

The typical means of preventing the flow of confidential information within firms is through the use of an organisational device called a Chinese wall. This may incorporate a number of mechanisms including: structural mechanisms, such as ensuring that the lawyers work in different departments; geographical mechanisms, such as placing the lawyers in different buildings or States; and procedural mechanisms, such as limiting access to files and databases.  There "is no rule of law that Chinese walls or other arrangements of a similar kind are insufficient to eliminate the risk".  However, they would be viewed with suspicion.  Factors which caused KPMG problems were rotating staff, the staff worked in the same building and were accustomed to working with each other and they were ad hoc chinese walls.

6.  Search warrant guidelines

ln Baker v. Campbell (1983) 153 CLR 52 - the question posed in the case stated was:

"In the event that legal professional privilege attaches to and is maintained in respect of documents held by (a lawyer) can those documents be properly made the subject of a search warrant issued under s.101 of the Crimes Act?"

The question was answered 'No'

The effect of these guidelines, in summary, is that. where the lawyer or Law Society is prepared to co-operate with the police search team, no member of that team will inspect any document identified as potentially within the warrant until the lawyer or Law Society has been given the opportunity to claim legal professi9nal privilege in respect of any of the documents so identified.

Where a claim is made in such circumstances. no member of the police search team will inspect any document the subject of the claim until either
(a) the claim is abandoned or
(b) title claim is dismissed by a court

If no lawyer, or representative of the Law Society, is in attendance at the premises the subject of the search warrant then, if practicable, the premises or relevant part of the premises should be sealed and execution of the warrant deferred for a period which the executing officer in his/her discretion considers reasonable in all the circumstances to enable any lawyer or responsible person connected with the premises to attend or, if that is not practicable, to enable arrangements for another person to attend the premises.

Where the lawyer or Law Society agrees to assist the search team the procedures set out below should be followed:-
• in respect of all documents identified by the lawyer or Law Society and/or further identified by the executing officer as potentially within the warrant, the executing officer should, before proceeding to further execute the warrant (by inspection or otherwise) and to seize the documents, give the lawyer or Law Society the opportunity to claim legal professional privilege in respect of any of those documents;
• if the lawyer or Law Society asserts a claim of legal professional privilege in relation to any of those documents then the lawyer or Law Society should be prepared to indicate to the executing officer the grounds upon which the claim is made and in whose name the claim is made; and
• in respect of those documents which the lawyer or Law Society claim are subject to legal professional privilege, the search team shall proceed in accordance with the guidelines as follows. In respect of the remaining documents, the search team may then proceed to complete the execution of warrant.

All documents which the lawyer or Law Society claims are subject to legal professional privilege shall under the supervision of the executing officer be placed by the lawyer and/or his/her staff, or the Law Society and/or its representatives, in a container which shall then be sealed.

See also Solicitors Rules, rr 2, 3