does not apply in-house
In Akzo
Nobel Chemicals Ltd and Akcros Chemicals Ltd v European Commission, the ECJ has
dismissed an appeal against an earlier General Court judgment that denied the
application of legal professional privilege to communications with in-house
lawyers.
Privilege
entitles a party to withhold written or oral evidence from production to a
third party or a court. In the main this consists of: (i) legal advice
privilege (confidential communications between lawyers and their clients made
for the dominant purpose of seeking or giving legal advice); and (ii)
litigation privilege (confidential communications between lawyers and their
clients, or the lawyer or client and a third party, which come into existence
for the dominant purpose of being used in connection with actual or pending
litigation).
Some
private and public sector organisations have in-house legal teams. So, does
legal privilege apply, for example, where a line manager seeks legal advice
from an in-house lawyer on the dismissal of an employee? The ECJ have confirmed
that legal privilege does not apply in such circumstances.
The ECJ held that
regardless of the national professional rules and ethical obligations to which
in-house lawyers are subject, due to their economic dependence and the close
ties with their employers, in-house lawyers do not enjoy a level of
professional independence comparable to that of an external lawyer. Therefore
legal professional privilege does not cover exchanges within a company or
corporate group with in-house lawyers. In the ECJ’s view, this does not lower
the level of protection of the rights of defence of undertakings as any
individual who seeks advice from a lawyer must also accept the restrictions and
conditions applicable to the exercise of that profession.
September 2010
This provides summary information and comment on the subject areas covered. Where employment tribunal and appellate court cases are reported, the information does not set out all of the facts, the legal arguments presented and the judgments made in every aspect of the case. Employment law is subject to constant change either by statute or by interpretation by the courts. While every care has been taken in compiling this information, we cannot be held responsible for any errors or omissions. Specialist legal advice must be taken on any legal issues that may arise before embarking upon any formal course of action.
