What types of legal privilege are recognised in your jurisdiction?

Under English law, legal professional privilege will apply to confidential communications/documents that meet the tests of legal advice privilege or litigation privilege. Both tests are derived from the common law; privilege has not been codified in statute.

Legal advice privilege relates to communications between a lawyer and client made for the dominant purpose of obtaining or giving legal advice. This includes not just advice relating to the law, but anything done within a legal context; for example, the exchange of draft contracts between one potential party and their lawyers.

Litigation privilege applies to communications and documents that were created for the dominant purpose of obtaining or providing advice or evidence in respect of litigation that is in reasonable prospect.

Legal advice privilege does not generally cover communications with (non-client) third parties. However, there are circumstances where legal advice privilege will attach to documents (including communications that are not between lawyer and client) that ‘tend to betray’ the content of legal advice.

Litigation privilege can apply to communications between parties other than lawyers.

Lawyers are also subject to statutory confidentiality obligations. The General Data Protection Regulation ((EU) 2016/679) (GDPR) came into force in 2018 along with the Data Protection Act 2018 (DPA). Together, GDPR and DPA provide a robust legal framework for data protection (including of personal data) in the UK. While these rules do not directly relate to the protection of communications between lawyers and clients, law firms have data protection obligations (including in respect of the personal data of their clients that will need to be protected).

While the Scots law position in relation to privilege is in many material respects now similar to that in England and Wales, it is not identical, and in this Guide, Scottish law is not separately considered.

To whom does legal privilege apply?

Legal advice privilege applies to lawyers. This includes all members of the legal profession, including solicitors, barristers, in-house lawyers, foreign lawyers, legal executives and licensed conveyancers who are employed to give advice on English law by a licensed body.

Communications with in-house counsel can be subject to legal advice privilege. But in-house lawyers often have commercial, business and administrative roles in addition to their legal roles, and should be aware that privilege will only apply to communications or documents made in their professional capacities as lawyers and with the requisite dominant purpose.

Legal advice privilege can only protect legal advice given by members of the legal profession. However, privilege will extend to certain regulated professionals who, although not qualified lawyers, are recognised as providing a legal service if they are an 'authorised person' (that is, authorised by an approved regulator). Courts have refused to extend legal advice privilege to accountants.

What criteria must be met for a communication to be privileged?

For a document or communication to be privileged, it must be confidential and meet the test for either legal advice or litigation privilege.

Privilege applies to the communication or document, not the underlying information. A communication may be confidential even if it involves publicly available information. Once a privileged document/communication is no longer confidential (ie, it has been disclosed to a third party) then it ceases to be privileged. However, if a document has been disclosed to a select group of parties – because, for example, they need to be aware of its contents, on the express basis that the document remains subject to the client’s confidentiality as against persons outside the group, then confidentiality is preserved and the document will remain privileged as against persons outside the group.

Legal advice privilege applies to communications between a lawyer and a client, for the dominant purpose of giving or obtaining legal advice ((Three Rivers DC v Bank of England (No 5) [2002] EWHC 2730) and to documents (including communications that are not between lawyer and client) that ‘tend to betray’ or ‘give a clue to’ the content of legal advice, provided those communications/documents are treated as subject to the confidentiality of the client (Lyell v Kennedy (No. 3) (1884) 27 Ch. D. 1 andVentouris v Mountain [1991] 1 WLR 607). ‘Lawyer’ includes all members of the legal profession. Any communications not involving a lawyer will only be privileged if the test for litigation privilege is satisfied. The ‘client’ does not include all employees of a client organisation but is limited to those who are authorised to seek and receive legal advice from the lawyer and so privilege does not extend to information provided by employees and ex-employees to or for the purpose of being placed before a lawyer (SFO v ENRC [2018] EWCA Civ 2006).

A dominant purpose of giving or obtaining legal advice includes not just advice relating to the law, but more broadly, what is done within a legal context. For example, a client may provide their lawyer with an update on the progress of a commercial matter that, on the face of it would appear to be confidential but is not legal; however, where the purpose of the relevant email was to provide the lawyer with an update of the client’s commercial dealings – ie, part of a continuum that aims to keep client and lawyer informed – so that the lawyer can suitably advise the client, this will be covered by legal advice privilege.

The courts have supported a party’s assertion that an internal investigation was covered by legal advice privilege. Despite the advice not relating to strict blackletter law or its application to the factual background of an investigation, the decision to instruct the firm to conduct the investigation was because of their legal expertise. The court held that advice sought from lawyers that is not legal advice could still be privileged provided that they are instructed for their legal expertise and the investigation was conducted within a legal context. If it is divorced from any legal role and created for a purely investigative role, then documents will not be privileged (Al Sadeq v Dechert LLP [2024] EWCA Civ 28).

Litigation privilege is a separate head of privilege applying to communications and documents that were created for the dominant purpose of obtaining or providing advice or evidence in respect of litigation that is in reasonable prospect.

Are there any penalties in your jurisdiction for over-extending or wrongly claiming excessive privilege?

A finding that a party has over-claimed privilege may have costs consequences. In general, the losing party in litigation will be required to contribute to the legal costs of the winner. But a winning party’s costs may be reduced if its conduct in the litigation has been unreasonable, including unreasonably exaggerating a claim or pursuing an unsuccessful claim.

Courts will be hesitant to go behind a solicitor’s affidavit that privilege has been correctly claimed, unless it is reasonably certain from the affidavit and other open evidence that the affidavit is incorrect (Re Edwardian Group Ltd [2017] EWHC 2805 (Ch)).

If a lawyer has over-extended or wrongly claimed excessive privilege in a way that amounts to misleading the court, it is open to the regulatory and disciplinary bodies to take disciplinary tribunal action against them, where consequences can include being ‘struck off’ or disbarred from continuing to practise law. A false claim of privilege during disclosure could also be prosecuted as contempt of court.

Does your jurisdiction recognise privilege in communications generated or transmitted via AI platforms or legal tech tools – and can this be undermined?

As there is no law on the effect of AI tools on privilege in England and Wales, practitioners must consider first principles.

Any output generated by a platform like ChatGPT, an automated contract generator or other AI or legal tech tool will not be protected by legal advice privilege as it is not a communication between a lawyer and a client. It may be protected by litigation privilege (assuming the courts accept that the AI tool is ‘communicating’ with the user) if it meets the other requirements of litigation privilege.

The requirement most likely not to be met is confidentiality. The standard terms of ChatGPT (and other publicly available AI tools) provide that the service provider may access and use both the user’s input, and the tool’s output, to further develop the tool, while confirming that the user ‘owns’ both the input and the output (although the there is an express acknowledgment that other users may ultimately own the same or similar output. Under these terms, neither the input nor output communication is definitively confidential. A client who feeds otherwise privileged legal advice/litigation evidence into an AI tool, for example, to check its accuracy, will likely be waiving confidence (and therefore any claim to privilege as exists) in that advice/document. ChatGPT has recently updated its terms to allow users to opt out of ChatGPT being able to use their information – for example to develop the tool. While this restricts/limits the use that the AI provider can make of the users’ input, in the absence of an express term covering the confidentiality of the input and output (as opposed to simple restriction of the AI tool’s use of such), it would be risky to rely on the opt out.

Non-public AI tools may go further in ensuring confidentiality in their terms and the situation may be different where a lawyer generates legal advice using a definitively confidential AI tool, checks the advice for accuracy (makes amendments) and communicates it to the client. The advice as communicated to the client will be subject to legal advice privilege. The original lawyer input into the AI tool and the AI-generated product might also be privileged under the ‘working papers’ rule, if it betrays the nature of the privileged advice given (RBS (Rights Issue Litigation) [2016] EWHC 3161 (Ch) and SFO v ENRC [2017] EWHC Civ 1017 – which was reversed on other grounds by the CA). However, the scope of that rule is uncertain and AI-generated output in particular might not be considered a working paper of the lawyer and if it is, alternatively, considered to be a communication, it will not qualify as a communication between lawyer and client.

A principled consideration of who actually owns the relevant documents making up the lawyer’s working papers (including under the terms of the lawyer’s retainer) may make questions of privilege moot (on relevance grounds) depending on context: if, properly construed, the relevant documents belong to the lawyer and not the client, an order for disclosure against the client will not bite on them.

Is litigation privilege recognised separately and, if so, what are the criteria?

Litigation privilege is a separate head of privilege that does not require the underlying communication in question to be between a lawyer and client.

Litigation privilege applies to communications and documents that were created for the dominant purpose of obtaining or providing advice or evidence/information in respect of conducting/settling or avoiding litigation that is in reasonable contemplation. Litigation means 'adversarial' proceedings (Re L [1997] AC 16), which includes court (English, UK or foreign), arbitral or employment tribunal proceedings, but not fact-finding investigations or inquiries. However, the proceedings do not need to have commenced, nor does there need to be at least a 50 per cent chance that litigation will occur, only that there is a real or reasonable apprehension of the prospect of litigation.

Litigation privilege does not cover documents that relate to the conduct or communication of the litigation more broadly, rather it only applies to documents that have been created with a dominant purpose of obtaining or providing advice or evidence in relation to the conduct/settlement or avoidance of litigation (WH Holding Limited v E20 Stadium LLP [2018] EWCA Civ 2652). Inquiries and investigations that are fact-finding and insufficiently adversarial in nature will not be covered by litigation privilege (though may be covered by legal advice privilege, to the extent the communications are with lawyers and involve the lawyers’ professional expertise in, for example, interviewing witnesses and gathering evidence).

Additionally, where there is a dual purpose to a document or communication, unless a dominant purpose for the litigation of can be established, litigation privilege will not apply to the document or communication.

Pre-existing documents that did not satisfy the dominant purpose test when created, may later satisfy the dominant purpose test and become subject to litigation privilege. For example, documents that have been gathered as part of the evidence to be adduced on behalf of one party will be privileged as a selection of documents (even if as individual pre-existing documents they were not privileged).

In Al Sadeq v Dechert LLP [2024] EWCA Civ 28, the Court of Appeal held that litigation privilege can apply to non-parties to a dispute, for example, the victim of an alleged crime, litigation funders or liability insurers. For privilege to apply, the relevant test is whether the document was prepared for the dominant purpose of seeking or obtaining legal advice, information or evidence where litigation was a reasonable prospect.

Does privilege apply to communications with in-house counsel? If so, does this apply to communications between in-house counsel and AI tools (eg, contract automation or compliance systems)?

Communications with in-house counsel will be protected, provided the dominant purpose test of legal advice or litigation are satisfied. In-house lawyers often have commercial, business and administrative roles in addition to their legal roles, and should be aware that communications or documents created under the guise of these other responsibilities will not be covered by privilege. The key question will be whether they gave the advice or made the communication in their professional capacity as lawyers and ‘whether the advice relates to the rights, liabilities, obligations or remedies of the client either under private law or under public law’ (Three Rivers District Council and others v Governor and Company of the Bank of England (No. 6) [2004] UKHL 48).

There is some doubt as to whether in-house counsel must maintain practising certificates in order for their communications to attract privilege. For this reason, it is considered best practice for in-house lawyers to maintain their practising certificates.

The courts have not considered whether ‘communications’/engagement with AI tools can be privileged; however; privilege can only apply to communications between a lawyer and client for the purposes of obtaining legal advice (or confidential documents/communication that tend to betray the content of such), or documents prepared for the dominant purpose of litigation. Communications between in-house counsel and an AI tool do not involve a client, and so can only possibly be subject to litigation privilege if the dominant purpose of the communication is litigation and the requirement of confidentiality is preserved. The use of an AI tool to generate contracts or compliance systems would therefore not be privileged. However, if the in-house lawyer then communicates that output in the course of providing legal advice, that communication would attract privilege. The original output, if it does not constitute a communication might also attract privilege, under the lawyers’ working papers rule if it tends to betray the content of the legal advice.

Lawyers should be aware of the terms of the particular AI tool. If those terms permit the provider of the service to access the input or output to use in its model, it is very likely that such communications will not be confidential, and so cannot be privileged. Also, unless there is an express understanding between the in-house lawyer and the AI provider that the communications will be treated confidentially, there is doubt as to whether any privilege that prima facie pertains in the input or output will be preserved.

Can legal privilege be waived? If so, how and by whom? And are there exceptions to legal privilege in your jurisdiction?

Privilege can be waived. The client has the power and right to waive privilege whereas a lawyer only (potentially) has the authority to waive the client’s privilege. This leads to potentially problematic situations whereby the client’s lawyer can inadvertently waive privilege.

Privilege is waived upon the disclosure of a document that is otherwise privileged. Where a party intentionally waives privilege in a document or communication, without reservation, the waiver of privilege in that communication is usually complete.

A party who deploys or relies on privileged material in legal proceedings may also find that the waiver extends further than originally intended. This is known as the principle of ‘collateral waiver’ or the rule against ‘cherry-picking’ – which aims to prevent a party choosing to rely on favourable aspects of its privileged material while hiding behind privilege to avoid having to disclose less favourable aspects. Collateral waiver will apply to documents that go to the same issue as the document/communication in respect of which privilege was originally waived.

Where privileged material has been inadvertently provided to a third party, the starting point is that the party receiving the inadvertently disclosed material owes no duty of care to the other party and is generally entitled to assume privilege has been deliberately waived, unless disclosure was procured by fraud, or where there has been an obvious mistake by the party disclosing. Therefore, once a party appreciates that their documents have been inadvertently disclosed by their side, they should notify the receiving party as soon as possible to seek to prevent waiver of privilege.

Privilege can be preserved under the principle of common interest privilege. This applies where parties wish to cooperate and share privileged information but do not wish for privilege in the shared information to be extinguished. There must be a common interest between the parties at the time of disclosure, although it is not necessary for there to have been a common interest at the time of the creation of the document. Typical relationships where there is a common interest are: co-defendants, an insured and insurer, and companies in same corporate group structure.

A party may share its privileged communications with others on confidential terms without losing privilege as against the rest of the world. This permits parties to share privileged information with experts and other witnesses.

Under the ‘iniquity exception’, documents or communications as part of or in furtherance of a fraud, crime or other iniquity will not be privileged. The exception applies even where the lawyer involved is unaware of the iniquity. It concerns documents that fall outside the scope of, or abuse the lawyer-client relationship – ie, to help the client commit the fraud, rather than to defend the client against the accusation of fraud.

Are third-party privilege reviewers used in your jurisdiction?

England and Wales lack a formal procedure for third-party privilege review. Various law enforcement and regulatory agencies (and, in principle, parties to civil disputes) can agree that such a process of review and determination of any claim to privilege by independent counsel.

Absent agreeing any specific procedure, parties disputing privilege must go to the time and expense of applying to the Court, which can fashion an ad-hoc solution if necessary to determine whether or not documents were privileged.

How is privilege treated in the context of cross-border investigations?

In general, English law applies to cases heard in English courts. The courts have rejected arguments that the law of privilege should be an exception to this rule (RBS (Rights Issue Litigation) [2016] EWHC 3161 (Ch)).

This means that communications that are not privileged in the jurisdiction in which they were made, can nonetheless be withheld in proceedings in England if they meet the English test for privilege. For example, advice given by Russian in-house lawyers, which is not privileged in Russia, will be privileged in an English proceeding (PJSC Tatneft v Bogolyubov [2020] EWHC 2437 (Comm)). This rule also applies in reverse; documents that are privileged under the law of the country they were made in will not necessarily be privileged in England.

English courts tend to respect the choice of law provisions in contracts. If privilege is a substantive issue in such a case, it will be viewed as a matter of the chosen foreign law, but English procedural law will still apply. For example, applications to refuse to disclose documents for privilege reasons will have to follow the necessary procedures in the English & Welsh Civil Procedure Rules.

What is the position of regulators and enforcement authorities regarding privilege?

The general rule is that as privilege is a ‘fundamental human right’, compulsory production notices, procedural disclosure obligations and law enforcement or investigatory notices or search warrants will not override privilege or require production of privileged material.

Where privileged material is seized under a search warrant or on a ‘raid’, the owner of the document will have an ability to assert privilege over such and prevent its inspection until such time as the claim to privilege has been determined.

As part of the common law, privilege can be limited or overridden by statute but only if done expressly. Certain statutes permit regulators and enforcement authorities to override privilege. For example:

• Freedom of Information Act 2000 (FOIA) – Documents can be requested through the FOIA, yet there is an exception to protect legally privileged information undersection 42. In certain instances, there are exceptions to section 42 where legally privileged information could be disclosed if it is in the public interest. The FOIA includes a non-exhaustive list of what is considered in the public interest.

• The Regulation of Investigatory Powers Act 2000 and the Investigatory Powers Act 2016 provide, among other things, for the collection, monitoring and interception of communications in relation to intelligence operations. Where communications are so harvested by law enforcement, they may enable law enforcement to collect material covered by LPP (for example, when communications are required to be intercepted or monitored to guard against serious threats to safety). Privileged material so obtained cannot be used as evidence in court, however.

• The Solicitors Regulation Authority (SRA) has the statutory authority and power to investigate, upon notice, incidents of misconduct and require solicitors to produce information and documents. The SRA has the power to see documents even if they are confidential and/or privileged.

What are the key recent developments or notable case law affecting legal privilege in your jurisdiction? While AI is a very new and emerging area, is there yet any specific case law, regulatory guidance, or enforcement activity involving legal privilege and the use of AI or tech?

There is not yet any case law or enforcement activity on the intersection of privilege and AI or tech. However, there have been a number of other recent developments in the law of privilege, particularly as it relates to investigations and fraud.

The iniquity exception: the ‘iniquity exception’ provides that there is no privilege in documents or communications that are themselves part of a fraud. Importantly, the conduct of the lawyer in the iniquity is irrelevant; the exception will apply even when the lawyer is an unwitting participant in the fraud. The Court of Appeal confirmed in 2024 that the iniquity exception is more easily established than previously argued. Privilege will not apply to documents or communications for which there is a ‘prima facie case’, that is, on an assessment of the material available at that time, the iniquity exists on the balance of probabilities. The earlier position was the more ambiguous test of a ‘strong prima facie case’ for the iniquity (Al Sadeq v Dechert LLP [2024] EWCA Civ 28).

Investigations: in the same case, the Court of Appeal confirmed that legal advice privilege could apply to documents and communications of lawyers in the course of or preparing for an investigation. While the parties and Court agreed that ‘purely investigative’ communications ‘divorced from the respondents’ role as lawyers’ would not be privileged legal advice, the Court held that, even though the work could have been done by non-lawyers, the lawyers in question were appointed for their legal expertise, which extended to skills in taking statements, assembling facts and handling evidence. The High Court has applied similar reasoning to litigation privilege, in circumstances where potential litigation was the only plausible reason for an investigation to be carried out (NMC Health Plc (in administration) v Ernst & Young LLP [2024] EWHC 2905 (Comm)).

The scope of litigation privilege: the Court of Appeal also clarified that litigation privilege applies to documents created for the dominant purpose of litigation, whether or not that person claiming privilege becomes, or expects to become, a party to that litigation. For example, communications from witnesses seeking advice on what evidence they can and should give a party to litigation, to participants in a joint venture that becomes party to litigation, and communications between liability insurers and litigation funders.

The shareholder rule: in 2024, the High Court abolished a longstanding rule that a company cannot assert privilege against its shareholders. The rationale for rule, the shareholders’ proprietary interest in the company, was at odds with the doctrine of corporate separate legal personality (Aabar Holdings SARL v Glencore Plc [2024] EWHC 3046 (Comm).

Looking ahead, what practical steps might lawyers in your jurisdiction consider taking to preserve privilege when using AI and legal tech?

The court has not yet ruled on how the use of AI tools might affect privilege. Lawyers seeking to preserve privilege when using AI and legal tech should return to first principles.

To ensure that communications are confidential, lawyers engaging with AI tools should use private or closed-system tools, and check that the terms for use of those tools do not permit the service provider to access the input or output generated or treat it as anything other than covered by the client’s confidentiality. Even publicly available AI tools such as ChatGPT which enable users to opt out of any term permitting the service provider to access or use input or output, do not guarantee that a client is able to assert confidentiality (a pre-requisite to the availability of a claim to privilege). Material produced by a lawyer’s interaction with an AI tool should not simply be relayed to a client (including because of the likely confidentiality difficulties), but considering such to inform the consideration, production and perfection of advice/material in the course of the exercise of lawyer’s skill to produce legal advice (which is then communicated to the client) or material for litigation can be covered by privilege if the confidentiality requirement is satisfied.

In the case of AI-generated material produced for legal advice but not for litigation, privilege will depend on the application of the ‘working papers’ rule. AI-generated documents may be privileged working papers (though the meaning of a working paper has not yet been fully clarified by the courts) if they tend to reveal legal advice communicated to the client; that is, if they allow the reader to infer (and not just to speculate about) the substance of that advice (Re Edwardian Group Ltd [2017] EWHC 2805 (Ch)).

To the extent that content/the fruits of legal work (including any produced with the assistance of AI) are not going to be directly communicated to a client, the lawyer and client may wish to consider whether terms as to who owns the lawyer’s working papers might assist to protect such against an order for disclosure against the client.

The Inside Track

What impact has the evolution of AI and tech had on the way that you deal with privileged communications in your practice?

While there may be a temptation to use AI to cut corners/costs, for the most part, the evolution of AI and tech has not affected the way legal practice ultimately deals with privileged communications, although it, perhaps, has caused lawyers to consider afresh the necessary safeguards that should be in place in circumstances where confidential (and potentially privileged) data of a client is reviewed outside the firm instructed.

When engaging with legal tech providers in connection with litigation/investigations/non-contentious work, lawyers will take care not to feed information into public tech tools but rather consider and secure confidentiality (whether with third parties or in-house) in relation to the processing and use of material (including privileged material) provided or generated as they would have done when handling or providing (privileged) information to third parties before the AI age.

Ultimately, while AI will gain greater significance in terms of saving time, human awareness, scrutiny and oversight will still be required and the buck needs to stop at a natural person: AI cannot sign a disclosure statement or a statement of truth (in relation to litigation, for example) or sign off on representations given to professional indemnity insurers.

If you could change one thing about how privilege operates in your jurisdiction, what would it be and why?

England and Wales is late to grapple with the issue of AI and privilege. Laypeople and lawyers alike are turning to tech to generate contracts and legal advice without certainty of whether that output will be protected – perhaps under the assumption that using non-public tools, or opting out of information sharing, will guarantee confidentiality.

While any clarity would be helpful, ideally privilege will continue to protect the fundamental interests it is intended to protect; to seek advice and consider the strength of one’s case without fear of disclosure. In other words, broad protection of legal communications with/assistance from AI, rather than a technical approach.

What common mistakes do you see people make that undermine legal privilege – and how can they avoid them?

Legal advice privilege only protects communications between lawyers and clients, and not all employees of a client company will be considered clients for this purpose. Lawyers can avoid this pitfall by carefully defining the client; precisely, but not exhaustively (at risk of excluding new or unexpected client employees).

Litigation privilege has a narrow scope that is often over-estimated. It covers legal advice and preparation of evidence, but not broader matters like funding or strategic reputation matters. To attract privilege these matters should be discussed with a lawyer, in the context of legal advice.

Labelling something as ‘legally privileged’ does not make it legally privileged. Some seem to consider that it does and that they can use such correspondence to seek to make highly prejudicial and relevant comments non-discloseable.

Automatic e-filing can undermine privilege when software (such as Outlook) automatically files an email to an electronic database if it has certain content or subject matter. The software does not know whether it is privileged or not. This can result in inadvertent disclosure of privileged material, often when a client is asked to disclose a file (eg, in a pre-action letter of claim or a GDPR request) before consulting lawyers. While privilege can later be asserted and the documents deemed to be inadmissible, one cannot purge somebody’s memory of what they have learned, which might provide them with an advantage in the litigation – an advantage that is impossible to reverse.

Some people engage an ‘AI notetaker’ on otherwise privileged calls without considering what happens to that data and whether confidence (essential to any assertion of privilege) could be lost.