Confidentiality

Commonly, clients want to ensure that what they tell their lawyer is confidential.

Communications between a client and their lawyer will remain confidential and are protected by Legal Professional Privilege (“LPP”). LPP applies where the central purpose of the communication is the giving or receiving of legal advice or, for use in existing or anticipated court proceedings”(Esso Australia Resources Ltd v Federal Commissioner of Taxation (1999) 201 CLR 49).

LPP:

• can attach to the entirety of a document or part thereof;
• can be expressly waived; or
• can be impliedly waived, where there is inconsistency between the conduct of the client and maintenance of the confidentiality of the communications with the lawyer.

Importantly, LPP does not attach where communications are made in furtherance of an illegal purpose or a fraud. A mere allegation of fraud is not enough; there must be something to “give colour to the charge” (Commissioner of Australian Federal Police v Propend Finance Pty Ltd (1997) 188 CLR 501).

In the matter of Novak & Novak [2020] FCWA 217, a litigation funding order was made in favour of the wife which required that $0.50 in every dollar paid to the husband’s solicitor on account of their costs be remitted to the wife’s solicitor’s trust account. Two days after the order was made, the husband’s solicitors (Law Firm C) filed a Notice of Ceasing to Act; effectively defeating the litigation funding order. Thereafter, the husband appeared to be self-represented. Sometime later a lawyer at Law Firm C confirmed to the Court that he had continued to assist the husband with his case but assured the husband had not incurred any fees. Shortly thereafter, the director of the firm (Lawyer C), sent an affidavit to the Court to “correct the record” and attached documents titled ‘Unbilled Costs Reports’, which recorded the time spent on the husband’s file and the charges to be raised; which, relevantly, post-dated the Notice of Ceasing to Act.  The husband asserted LPP over the reports.

O’Brien J made findings that the descriptors and any narrative contained in the unbilled costs reports only describe the topic of the advice and do not contain or allude to the advice actually given.  With reference to a specific entry on the report, a letter of advice to the husband, described as being “in relation to fees in light of dollar for dollar”, his Honour was satisfied that that descriptor contradicted the husband’s evidence about his lack of representation at the time. The descriptor was sufficient to give “colour to the charge that steps were taken, and potentially advice sought, for the purpose of circumventing the operation of the “dollar for dollar” order, while still retaining the benefit of legal advice and representation which extended to strategic and procedural advice and to the drafting of court documents” [46]. His Honour said that this was evidence that advice was sought and given for a purpose properly described as “the kind of sharp practice often associated with equitable fraud” [40]. 

His Honour did not make adverse findings against the lawyer but said that he would provide a copy of his reasons to the Legal Profession Complaints Committee for investigation.

If this article has triggered questions on confidentiality, please contact us on 8525 2700 or click here to request an appointment with one of our experienced team members.

Article written by Kirstin Attard
Photo by Tim Mossholder on Unsplash