The House of Lords Leaves a Question Unanswered

December 1, 2004

The previous Privilege Point cited a recent decision of the British House of Lords reaffirming the premise on which the attorney-client privilege rests. That same decision (Three Rivers District Council v. Governor & Co. of the Bank of England (No 6), [2004] UKHL 48 (H.L. Nov. 11, 2004), available online in PDF format) left an additional question unanswered.

In an earlier Court of Appeals decision regarding advice the Bank of England received from its lawyers about responding to an investigation into the BCCI scandal, the lower court held that the attorney‑client privilege only covered communications between the Bank’s lawyers and senior Bank executives charged with handling that issue – and did not cover the lawyers’ communications with lower‑level Bank employees. Most American courts formerly followed such a narrow approach (called the “control group” test), but after a 1981 United States Supreme Court decision (Upjohn), most American jurisdictions moved to a “functional” test that does not rest solely on a corporate employee’s place in the corporate hierarchy. The House of Lords declined to address the Court of Appeals decision, although one Lord mentioned Upjohn, and explained that “the issue is a difficult one with different views, leading to diametrically opposed conclusions, being eminently arguable.” Id. para 47.

It will be interesting to see if the United Kingdom eventually follows the Upjohn reasoning in expanding the privilege protection for corporations.