I heard it through the grapevine: The difference between legal professional privilege and confidentiality

August 29th, 2016
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By Kristen Wagner and Claire Brett

In the context of legal professional ethics, the terms ‘confidentiality’ and ‘privilege’ are often used interchangeably. While these two terms may overlap in some respects, they remain two distinct concepts. The distinction between confidentiality and legal professional privilege is absolutely essential insofar as their differences ensure the proper functioning of the South African legal system, which is dependent on freedom of communication between legal practitioners and their clients.

A brief consideration of confidentiality

‘Confidentiality’ refers to the duty of an attorney to preserve the confidentiality of all communications between himself or herself and the client (Willem de Klerk et al Clinical Law in SA 2nd (Durban: LexisNexis 2006) at 42). The norm is that this duty may present itself as an express or tacit term of a contract, by virtue of a fiduciary relationship or even in terms of a delictual duty prohibiting such disclosure. Confidentiality is said to be far wider than the doctrine of legal professional privilege as information may be confidential even when it is not protected by legal professional privilege. Confidentiality extends to all information in respect of the clients’ affairs, whether oral or documentary in nature. The right to have communications protected belongs solely to the client and only the client will be able to expressly waive this right (De Klerk op cit). This duty survives termination of the mandate between attorney and client and even the death of the client. This (mostly) contractual duty is essential insofar as it ensures that the client is (without fear) able to confide in and disclose all relevant information to the legal practitioner insofar as it pertains to the circumstances or case. Legal practitioners must ensure that confidentiality is respected, protected and upheld at all times. A breach of this duty by a legal practitioner may lead to an action for damages against himself or herself or may culminate in the granting of a prohibitory interdict against further disclosure. The duty of confidentiality remains in effect at all times and not just in the face of legal demands for information.

Demarcating the distinction: Understanding legal professional privilege

The International Code of Ethics prohibits legal practitioners from disclosing, unless lawfully ordered to do so by a court or in terms of statute, communications made to them in their capacity as legal practitioners, even after ceasing to be the client’s attorney/legal practitioner (J Auburn Legal Professional Privilege: Law and Theory (USA: Hart Publishing 2000) at 23). On this basis, one needs to consider the doctrine of legal professional privilege as it applies in South
Africa. This doctrine maintains that certain communications between practitioners and clients may not be used in evidence.

As delineated in Thint (Pty) Ltd v National Director of Public Prosecutions and Others; Zuma v National Director of Public Prosecutions and Others 2009 (1) SA 1 (CC) there are said to be four requirements for legal professional privilege to apply, namely:

  • The legal practitioner must have acted in a professional capacity. This goes beyond the mere fact that the legal practitioner is an admitted attorney or advocate. Other indicators such as the payment of fees or recorded holding of consultations may also be considered for this requirement to be met.
  • The client must have consulted with the legal practitioner in confidence. At this point, the overlap between confidentiality and privilege becomes apparent as confidentiality is a necessary pre-
    condition for the claiming of privilege. A communication must have been intended to be confidential for it to be privileged. This requirement applies to all communications between the legal practitioner and client, whether written or oral. This requirement is often contested and one may find confidentiality is absent where, for example, the attorney acts for both parties in a case.
  • The communication must have been made for the purpose of obtaining legal advice (or, at the least, closely connected thereto). A distinction is drawn between –

– legal advice privilege, which pertains to all communications between the legal practitioner (attorney/advocate/salaried in-house legal adviser) and the client (in order to give the client advice in a professional capacity); and

– litigation privilege, which pertains to and protects all communications between the legal practitioner and the client or between either of them and a third party with respect to actual or contemplated litigation, insofar as the case is in the process of investigation and/or preparation for trial.

In the recent case of South African Airways Soc v BDFM Publishers (Pty) Ltd and Others 2016 (2) SA 561 (GJ) [2016] 1 ALL SA 860 (GJ), the court was tasked with considering the applicability of an interdict as a form of relief to an applicant whose confidential legal advice had been leaked into the public domain in an unauthorised manner.

The applicant, South African Airways (SAA), had previously sought and obtained an interdict against the respondents (three media houses) preventing further dissemination of a legal impact analysis document prepared by SAA’s in-house legal adviser. In November 2015 the confidential legal text was leaked and published in various national newspapers.

In setting aside the previous order, Sutherland J emphasised the distinction between legal advice and litigation privilege; delineating that while the common law right to legal professional privilege is a necessary means of protecting South Africa’s adversarial justice system, it is not an absolute right. Sutherland J remarked that the right to legal professional privilege is a ‘negative right’ making inadmissible as evidence, legal advice provided to a client by a legal practitioner. This right cannot be interpreted as being a positive right, which would otherwise entitle a client to suppress publication once confidentiality has already been breached. As such, legal professional privilege cannot be claimed against the world at large; providing protection from involuntary disclosure. Granting of an interdict in circumstances where harm has already occurred is futile. As such, once the public becomes aware of confidential legal communications between the client and legal practitioner, no remedy exists to restrain further dissemination. (See law reports ‘Civil Procedure’ 2016 (June) DR 40 and ‘Evidence’ 2016 (June) DR 44.)

  • The advice given must not facilitate the commission of a crime or fraud. This applies regardless of the fact that the attorney may be completely unaware of such crime or fraud. In the case of Waste Products Utilisation (Pty) Ltd v Wilkes and Another 2003 (2) SA 515 (W), a tape recording was introduced into evidence wherein the defendant, in discussion with his attorney, intended to fabricate evidence in order to mislead the court. While accepting that the tape recording was unlawfully made, the court admitted it into evidence; stating that the legal professional privilege so claimed by the defendant was forfeited as a result of the criminal intention behind the communication.

In addition, legal professional privilege will not apply to communications, which are not intended to be privileged, communications not intended to be confidential, the name of the client and facts learnt through the legal practitioners own means and methods (De Klerk op cit at 42). The privilege belongs to the client and only the client may expressly waive such privilege.

In the case of Mohamed v President of the Republic of South Africa and Others 2001 (2) SA 1145 (CC) it was held that legal professional privilege extends to salaried legal advisers in the employ of the government. Furthermore and in terms of Van der Heever v die Meester en Andere 1997 (3) SA 93 (T) legal professional privilege was further extended to salaried legal advisers in the employ of a private body such as a firm giving tax advice. The courts are not, however, willing to extend privilege to persons giving legal advice who do not have a law degree, which would enable them to be admitted as an attorney or advocate. An example hereof would be a chartered accountant giving tax advice.

Relevant examples of the applicability of legal professional privilege and statutory challenge?

In the recent case of A Company and Others v Commissioner, South African Revenue Service 2014 (4) SA 549 (WCC) it was held that certain portions of the applicant’s attorney’s tax invoice were protected from disclosure due to legal professional privilege. In the past, whenever South African Revenue Service (Sars) required information from a taxpayer regarding an audit or interview, the taxpayer could refuse on the grounds of the information being legally privileged. However, in terms s 42A of the Tax Administration Laws Amendment Act 23 of 2015, a taxpayer claiming the applicability of legal professional privilege will now have to prove the validity of such privilege by providing a list of extensive information which includes – but is not limited to – a description of each and every document not provided and full details of the legal practitioner.

Interestingly, and as another topical issue currently being considered, the Financial Intelligence Centre Act 38 of 2001 (FICA), provides major barriers to the doctrine of legal professional privilege. In terms of sch 1 of FICA, accountable institutions such as banks and attorneys are required to comply with various duties. The most contested of these duties is the onerous duty placed on accountable institutions to report all suspicious activities or transactions to the Financial Intelligence Centre (FIC). Failure to report any suspicious activities relating to the client may result in a hefty fine being imposed on the practitioner of up to R 10 million or up to 15 years’ imprisonment. It is argued that the inclusion of attorneys in anti-money laundering legislation such as FICA is unconstitutional and threatens the independence of the legal profession. There is a need to maintain the rules of legal professional privilege in order for the legal profession to remain independent. Such duties erode away at the doctrine of legal professional privilege. Suggestions have been made, which include FICA being amended to allow attorneys to report suspicious transactions to the provincial law society as opposed to the FIC. As it stands, FICA provisions – as they apply to attorneys – remain in force as it is contended that attorneys are often used by money launderers and their trust accounts are most often the vehicles used to launder money.

Conclusion

The contractual duty of confidentiality and the common law doctrine of legal professional privilege are essential in maintaining the independence of the legal profession and in assuring clients that any information communicated between them and the legal practitioner will not be disclosed. Confidentiality remains in effect infinitely while legal professional privilege must be claimed by the client and generally ensures that all communications between client and legal practitioner are not admissible in subsequent legal proceedings.

While FICA and the Tax Administration Laws Amendment Act 23 of 2015 present concerns for legal practitioners insofar as the doctrine of legal professional privilege is concerned, we remain hopeful that such concerns will be remedied in the near future; preserving this essential doctrine.

 

Kristen Wagner BA Law and Psychology (Rhodes) LLB (cum laude) (UJ) is a financial crime risk graduate trainee at FNB in Johannesburg. Claire Brett is a student assistant at the Soweto Law Clinic in Johannesburg.

This article was first published in De Rebus in 2016 (Sept) DR 22.