Ford, R (on the application of) v The Financial Services Authority

Joint legal advice privilege may arise between a company, its directors or senior employees and their lawyers even without a formal joint retainer. The question is factual and must be determined by the circumstances existing when the communication was made. The claimant must show that he sought advice in an individual capacity, made that clear, and that the other privilege-holders and the lawyer knew or ought to have known of that position. The communication must also be confidential. A person’s interest in advice given to a company does not itself establish joint privilege. Legal professional privilege is not subject to a balancing exercise based on competing public interests. Communications from accountants do not attract legal professional privilege merely because they are forwarded or attached to a solicitor’s email.

Stewart Ford sought judicial review of the Financial Services Authority’s reliance, in regulatory investigation reports and warning notices, on eight emails and attachments sent by Irwin Mitchell to him and two other Keydata executives.

Keydata had retained Irwin Mitchell in connection with an FSA investigation. Keydata later entered administration, and its administrators waived the company’s privilege. The executives claimed that two communications contained advice given jointly to Keydata and to them personally, so that the company’s waiver could not affect their privilege. They also challenged reliance on material supplied by Grant Thornton.

The central issues were whether joint legal advice privilege existed over the two communications and whether the Grant Thornton material was privileged.

1. The claim succeeded in part. The claimant and interested parties enjoyed joint legal advice privilege with Keydata in the email of 7 February 2008 at 17:22 and the email of 18 April 2008 attaching the note of the conference with counsel. Keydata’s waiver did not waive the executives’ joint privilege, and the FSA could not rely on those communications in the regulatory proceedings.
2. Legal advice privilege requires a confidential communication between lawyer and client. The relevant relationship must exist when the communication is made. The same principles apply to joint privilege, but the interests of all persons claiming the privilege must be considered.
3. Where there is no formal joint retainer, the court must determine the true factual position. The claimant must establish that:
   1. he communicated with the lawyer to seek advice in an individual capacity;
   2. he made clear that he sought advice individually rather than only as a corporate representative;
   3. the other persons sharing the privilege knew or ought to have appreciated that position;
   4. the lawyer knew or ought to have appreciated that she was communicating with him individually; and
   5. the communication was confidential.
4. The court rejected the American approach that corporate officers cannot assert joint privilege over advice concerning corporate affairs once the company has retained the lawyers. The English law of legal professional privilege recognises no general public-interest balancing exercise.
5. The evidence showed that Irwin Mitchell and counsel were advising the executives personally as well as Keydata in the two disputed communications. The FSA had not cross-examined the witnesses and could not fairly invite rejection of their evidence.
6. The Grant Thornton attachments and forwarded material were not privileged. Legal professional privilege ordinarily applies only to communications with a member of a relevant legal profession, and attaching accountants’ material to a solicitor’s email does not confer privilege.
7. The remaining consequences concerning use or retention of the documents were left for a remedies hearing.

This was a first-instance judicial review claim. Permission had previously been granted in relation to the disputed communications. The court granted relief concerning two communications, dismissed the claim concerning the Grant Thornton material, and directed a remedies hearing.