Makar v PricewaterhouseCoopers LLP

Disclosure will not be ordered merely because a document may relate to the parties’ dispute. A document containing legal advice is privileged: its existence may be disclosed, but the opposing party is not entitled to inspect it. Even if privilege is unavailable, disclosure requires relevance to the issue before the court. Documents are not necessary for an interlocutory application where they cannot affect the pleaded cause of action or the disposal of that application.

The claimant applied for disclosure of two categories of documents. The first was a 2005 letter from Allen & Overy concerning possible liability to compensate or indemnify her for legal and other expenses. The second comprised documents recording when the defendant decided to resign as the company’s auditor.

The application arose in the context of the defendant’s application to strike out the claim on the basis that it disclosed no arguable cause of action. The central issue was whether either category was relevant or necessary to the disposal of that application.

1. The application for disclosure was refused. The documents were not necessary for the disposal of the defendant’s strike-out application.
2. The Allen & Overy letter was manifestly privileged because it contained legal advice concerning the defendant’s potential exposure and whether the matter should be referred to in the accounts. The defendant was required to disclose the existence of the document, but the claimant was not entitled to inspect it.
3. Even if the letter were not privileged, it was not relevant to the pleaded issue. The claimant’s cause of action concerned the defendant’s alleged liability for sums incurred in obtaining advice from Herbert Smith after her departure from the company. The amount of compensation that might have been contemplated in legal advice could not alter the cause of action.
4. The precise date on which the defendant decided to resign as auditor was also unexplained as relevant to the existence of the pleaded cause of action. Since the documents were not necessary for determining the strike-out application, disclosure was inappropriate.

Not stated in the judgment.