Raiffeisen Bank International AG v Asia Coal Energy Ventures Ltd & Anor

Legal advice privilege protects confidential solicitor-client communications made in a relevant legal context. It extends to a continuum of communications directly related to the solicitor’s professional role, even where a particular communication does not itself request or give legal advice. A client’s authority for a solicitor to give an independent confirmation to a third party does not, without more, waive privilege in the underlying instructions. Waiver may arise where the client itself puts those instructions or the solicitor’s authority in issue. Communications concerning the holding and payment of funds in a transaction for which legal advice is being given may therefore fall within the protected continuum.

The Bank released security over shares in reliance on a solicitor’s confirmation from Ashurst that it held US$85 million and had irrevocable instructions concerning its transfer to escrow or continued retention. The funds were later paid from Ashurst’s client account. The Bank claimed that Ashurst had breached obligations undertaken by the confirmation.

In the proceedings, the Bank sought further information and disclosure of documents recording the client’s instructions and subsequent changes to them. Moulder J ordered disclosure of client-account balances but held the remaining documents privileged: [2019] EWHC 3 (Comm). The Bank appealed. The central question was whether the instructions and related communications attracted legal advice privilege.

1. Appeal dismissed. The documents sought were protected by legal advice privilege. The Court of Appeal upheld Moulder J’s refusal of further disclosure, and refused to order answers to the Bank’s requests for further information.

2. Legal advice privilege requires confidentiality and a communication made for legal advice, or in a relevant legal context. Applying Balabel v Air India [1988] 1 Ch 317 and Three Rivers District Council v Bank of England (No 6) [2004] UKHL 48, the court held that the protection extends to communications forming a continuum directly related to the solicitor’s professional duties in the transaction. Privilege is absolute unless the client waives it; the court does not balance privilege against the value of disclosure.

3. Conlon v Conlons Ltd [1952] 2 All ER 462 did not establish a general rule that privilege is lost whenever a client instructs a solicitor to communicate information to a third party. It was confined to its context, in which the client had put the solicitor’s authority to settle in issue. Here, the client had not challenged Ashurst’s authority to provide the confirmation. The Bank’s attempt to investigate the instructions did not waive the client’s privilege.

4. The confirmation was an independent legal commitment by Ashurst, not merely an agency communication of the client’s instructions. Authority to give it did not authorise disclosure of the underlying communications. Those communications, and later instructions concerning changes to the holding or payment of the funds, were part of Ashurst’s legal role in advising on the financing transaction and protecting its client’s interests.

5. The requests for further information also failed independently. They were prolix, repetitive, unnecessary and disproportionate under Civil Procedure Rules 1998, CPR 18 PD 1.2. The Bank was ordered to pay Ashurst’s appeal costs, summarily assessed at £105,000.

• Court of Appeal (Civil Division) — dismissed the Bank’s appeal and upheld the refusal of disclosure of privileged documents: [2020] EWCA Civ 11.

• High Court (Commercial Court) — Moulder J ordered disclosure of client-account balances but otherwise refused disclosure and further-information applications on the ground of legal advice privilege: [2019] EWHC 3 (Comm).