Three Rivers District Council & Ors v The Bank of England

Legal advice privilege protects confidential solicitor-client communications made to obtain professional legal advice or assistance concerning legal rights and liabilities, including communications ancillary to that purpose. A solicitor’s ordinary business, a broad retainer, or concern about criticism does not itself extend the privilege. Advice principally directed to preparing or presenting evidence to an inquiry is not privileged where its dominant purpose is not legal advice on rights and obligations. The court declined to create a quasi-litigation privilege for assistance in a private, non-statutory inquiry. Individual communications made for specific legal advice may nevertheless be protected, so documents must be assessed by reference to their purpose rather than the retainer as a whole.

The Bank appealed from a declaration by Tomlinson J concerning documents exchanged between the Bank’s Bingham Inquiry Unit and Freshfields. The declaration identified only communications made for seeking or obtaining legal advice concerning the Bank’s rights and obligations, and parts evidencing those communications, as capable of being withheld.

An earlier appeal, Three Rivers District Council v Bank of England (No 5) [2003] EWCA Civ 474; [2003] QB 1556, had dealt with documents obtained from third parties. The present appeal concerned whether advice on preparing and presenting evidence to the Bingham Inquiry constituted legal advice, and whether a retainer that also involved advice on legal rights and obligations brought all related communications within privilege.

The Court of Appeal delivered a single judgment to which Lord Phillips MR, Longmore LJ and Thomas LJ all contributed, and dismissed the appeal.

1. Earlier decision. The Court held that its judgment in Three Rivers (No 5) did not clearly answer whether advice on presenting material to the Inquiry was legal advice. The issue therefore had to be decided afresh, while taking that judgment into account.
2. Meaning and scope of legal advice privilege. Legal advice means advice in relation to law. The authorities, including Greenough v Gaskell (1833) 1 My & K 98, Wheeler v Le Marchant (1881) 17 Ch D 675, Minter v Priest [1930] AC 558 and Balabel v Air India [1988] Ch 317, supported protection for confidential communications made in a solicitor-client relationship for professional advice or assistance requiring legal expertise in relation to legal rights and liabilities. Ancillary communications may be protected, but work is not privileged merely because it falls within a solicitor’s ordinary business or a broad retainer.
3. Inquiry assistance. The dominant purpose of Freshfields’ work was preparation and presentation of evidence and submissions to the Bingham Inquiry, rather than advice on the Bank’s rights and obligations. Section 1(3) of the Tribunals of Inquiry Evidence Act 1921 did not resolve the issue. The Court declined to extend privilege into a quasi-litigation privilege for assistance in this private, non-statutory Inquiry merely because the Bank wished to avoid criticism or protect its reputation.
4. Specific legal advice. The possibility that some communications contained advice on legal rights, obligations or a statutory point did not cloak the whole retainer with privilege. Communications made for specific legal advice, and documents necessary for that advice, could be privileged under Balabel. The judge was therefore right to require a further and better list identifying the documents by reference to their purpose.
5. Orders. The appeal was dismissed in accordance with the agreed order. Leave to appeal to the House of Lords was refused. A stay was granted until 22 March 2004 pending a petition, subject to continued discovery and liberty to apply.

• Court of Appeal (Civil Division) — On 1 March 2004, dismissed the Bank’s appeal, refused leave to appeal to the House of Lords and granted a temporary stay on agreed terms. [2004] EWCA Civ 218.
• High Court of Justice, Queen’s Bench Division (Tomlinson J) — On 13 December 2002, declared the limited classes of documents capable of being withheld on legal advice privilege and ordered a further and better list. The lower-court citation is not stated in the judgment.