Atos Consulting Ltd v Avis Plc

On an application under CPR 31.19 to challenge redactions or claims to privilege, the court should proceed principally on the evidence. If the asserted right is established and there is no sufficient challenge, it should be upheld. If the challenge has a proper evidential basis, the court may require further evidence and, only as a last resort, inspect the documents.

Legal advice privilege does not attach to commercial or management material merely because an in-house lawyer reviewed, amended or approved it. Litigation privilege requires the document to have been produced for the dominant purpose of obtaining legal advice or conducting litigation. Preliminary communications and arrangements are not privileged merely because they relate to anticipated proceedings.

Atos and Avis were engaged in substantial proceedings concerning the performance and termination of a master services agreement for a financial systems project. At a pre-trial review, Atos sought disclosure of unredacted Avis board minutes and further documents. Avis challenged Atos’s claims to privilege over redacted drafts of a project report and ten emails disclosed by Oracle.

The applications raised the proper approach under CPR 31.19 where relevance or privilege was asserted, and whether the particular redactions and documents were protected. The court also addressed several ancillary disclosure requests, including requests concerning restructuring programmes and electronic back-up material.

1. Procedure under CPR 31.19. The court accepted and adopted a staged approach. It must first consider the evidence. If the evidence establishes the right to withhold inspection and there are no sufficient grounds for challenge, the right should be upheld. If the right is not established, inspection should be ordered. If the asserted right is properly challenged, the court may require further evidence and may inspect the documents where no other appropriate method will resolve the issue. Inspection is a last resort.
2. Atos’s challenge to the board-minute redactions. Relevance can justify redaction. The evidence established that the challenged passages concerned unrelated confidential matters, including unrelated expenditure and other board business. There were no sufficient grounds for further evidence or inspection. No further order was made on those redactions.
3. Draft FSP reports. The explanations supporting legal advice privilege were inadequate and raised real concerns that the correct test had not been applied. The court inspected the drafts and ordered inspection of all passages not covered by legal advice privilege. Communications to or from the in-house lawyer in the context of obtaining legal advice could be privileged. Drafts prepared by employees, however, were not privileged merely because they had been reviewed, amended or approved by the lawyer. Commercial recommendations and presentation reflecting legal advice were not themselves privileged unless they disclosed the advice or its gist. The approach in Three Rivers DC v Bank of England (No 6) was applied.
4. Ten emails. The evidence disclosed confusion over the basis of the privilege claim and failed to answer valid challenges. Applying the dominant-purpose test, the emails concerned preliminary steps and arrangements rather than communications produced for the purpose of obtaining advice or conducting litigation. They were therefore not covered by litigation privilege. The approach in Balabel v Air India was treated as relevant by analogy.
5. Other disclosure. Avis was ordered to search for and disclose further documents explaining changes to the Business Support Centre in the context of the restructuring project or Fit to Grow programme. No further disclosure was ordered for the overwritten spreadsheet, the already-produced email, or the K:Drive and back-up tapes, the latter request being late, exploratory and disproportionate.

First-instance decision. The judgment itself records no earlier appellate decision.