BM Brazil 1 Fundo De Investimento EM Participacoes Multistrategia & Ors v Sibanye BM Brazil (Pty) Limited & Anor

A waiver of legal professional privilege requires more than a reference, express or inferred, to legal advice. The reference must be sufficient in the circumstances, and the party said to have waived privilege must rely on it to support or advance its case on an issue for determination. A purely narrative account of events does not ordinarily amount to waiver. The fairness principle governing disclosure of further privileged material applies only after waiver has been established. Where waiver is established, the whole-document principle may require production of the relevant document unless it deals with separate, severable subject matters.

The claim arose from a share purchase agreement for companies owning a nickel mine in Brazil. The defendants relied on an alleged geotechnical event as a material adverse event and purported to terminate the agreement.

The claimants applied for disclosure of emails over which legal professional privilege had been asserted. They contended that two sentences in a witness statement, recording the board’s unanimous decision to support termination, referred to privileged legal advice and thereby waived privilege. The court had to determine whether the evidence contained a sufficient reference to legal advice and whether the defendants relied on that reference to advance their case.

1. Application dismissed. The court declined to order disclosure of the emails on the basis of waiver of legal professional privilege.
2. Legal professional privilege is a fundamental right of the client and its loss through waiver must be carefully controlled. The fairness rationale may justify production of further privileged documents where a party has deployed only part of the relevant advice, but fairness alone does not establish waiver.
3. The principles in Great Atlantic Insurance Company v Home Insurance & Others [1981] 1 WLR 529, including the whole-document principle, operate only once waiver has first been established. The court accepted that it was not open to the judge in PCP Capital Partners LLP & Anr v Barclays Bank Plc [2020] EWHC 1393 to depart from Great Atlantic, and agreed with the summary of the applicable principles in that decision.
4. A valid waiver requires both a sufficient reference to the legal advice and reliance on that reference to support or advance the waiving party’s case on an issue for the court to decide. Waiver cannot generally be founded on an inferred reference to advice.
5. The two impugned sentences merely recorded that the board unanimously supported termination and understood that the transaction should not proceed. They contained no reference to legal advice. In any event, they did not rely on the advice to advance the defendants’ case; they were narrative evidence based on recollection. Waiver was therefore not established.