Comment: Navigating the protection of sensitive documents

The focus is now justifying why particular documents should be protected, says Connal. Picture: Contributed.

A number of recent cases in the English courts have brought this issue to the fore, where it may appear there has been a softening of the long-held convention that documents generated as a result of advice provided by or during investigations conducted by a lawyer, would not later be open to scrutiny anywhere by anyone.

In Scotland, when police attempted to serve a search warrant on a firm of solicitors to seize a client’s documents, the lawyers contested that some of the documents were protected under legal privilege and refused to hand them over. Alarmingly, one prosecution service official described the firm’s efforts to protect their clients’ legal privilege “as a serious matter of obstructing justice”. Lord Brodie, hearing a Bill of Suspension at the High Court, held a different view, that the search warrant was oppressive, and it was subsequently dismissed.

Legal privilege has been described as a basic right critical to the administration of justice, but it seems the days are gone when a lawyer needed do no more than indicate to a court that certain documents were covered and this ancient right was accepted. The focus has switched to justifying why particular documents should be afforded protection. This drive to dilute the standing of legal privilege can in some ways be attributed to the growth of our modern regulatory society.

While it is commendable that safety standards in the workplace continue to improve under the auspices of the HSE, for example, it is worth noting that regulators do more than simply prosecute.

Increasingly, a great deal of a regulators’ time involves conducting investigations, and this throws up all kinds of questions as to whether clients are entitled to protect materials from being seized in these investigatory scenarios.

This tug of war intensifies as companies try to protect materials from being handed over, while regulators, who look to encourage co-operation and openness, push for the maximum of materials to be disclosed.

Care needs to be exercised in dealing with a regulatory system that wants to have all the cards on the table before deciding what happens next, be that a prosecution, the levelling of a civil penalty, or serving of a notice, all of which have significant consequences for the business involved.

These new pressures create problems for business owners. For a company with multiple manufacturing or production sites, for example, it is in their best interests to establish a good relationship with regulatory authorities. However, countering a regulator’s perception that a business appears be withholding information has to be balanced against the increased risk that the business could do something that in legal terms may not be sensible or in their best interests.

Against this changing legal backdrop, can businesses take legal advice properly if there is a risk that a judge will order materials to be handed over to a prosecutor, regulator or a court at a later stage? The manner in which lawyers conduct investigations into complex situations on behalf of clients, and on how they ultimately deliver and record legal advice and solutions, may need to be reassessed.

It comes down to a commercial decision as to how far a point can, or should, be pushed, but businesses have to be particularly mindful of the consequences of disclosing, or indeed, in some situations, not disclosing, sensitive or “privileged” documents. Taking proper legal advice means business-owners are less likely to succumb to pressures, which may lead them on a course of action that could have long-lasting and damaging repercussions both for individuals and the business.

Craig Connal, QC, partner and litigation specialist at legal firm Pinsent Masons.