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Focus: Commercial Litigation – August 2005

Privilege, in-house counsel and practising certificates

In brief: In-house lawyers are not required to hold practising certificates in order for confidential communications between them and their employers to be privileged, but it is still better to have them than not. Partner Irene Trethowan (view CV) and Lawyer Duncan Travis report on the appeal decision in Commonwealth of Australia v Vance [2005] ACTCA 35.

The Court of Appeal of the Australian Capital Territory has upheld an appeal against a decision that a lawyer who is an employee of the client must hold a practising certificate for communications between the lawyer and client to be privileged. While the possession by an employee lawyer of a practising certificate is still very relevant to the question of privilege, it is not a pre-condition.

The trial

The trial concerned a claim by Russell Vance about the allegedly unlawful termination of his employment in the Royal Australian Air Force. Mr Vance sought access to communications to and from legal officers in the Defence Legal Service who, while they were admitted to practice, did not hold practising certificates.

Justice Crispin held that legal professional privilege only arises to protect the confidentiality of communications with legal practitioners who have an actual right to practice. An actual right to practice can only be conferred by statute or the possession of a practising certificate. In this case, neither of those conditions were met, hence confidential communications with the legal officers were not privileged and were required to be produced for inspection.

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Issues in the appeal

The Commonwealth appealed the decision on two bases:

  • that Justice Crispin erred in introducing a requirement of a practising certificate that was not found either in the Evidence Act 1995 (Cth) (the Evidence Act) or at common law; and
  • that his Honour had erred by having had regard to evidence of Ms Jacqui Kelly, a Minister in the Federal Government, to a Senate Committee, contrary to the Parliamentary Privileges Act 1987 (Cth) (the Parliamentary Privileges Act).

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The requirement of practising certificates

The Court of Appeal (consisting of Justices Gray, Connolly and Tamberlin) first considered whether the claim for privilege was to be determined under the common law or the Evidence Act. The court observed that Justice Crispin had discerned the requirement of an 'actual right to practice' from common law decisions made before the enactment of the Evidence Act.

The court held that the test for whether documents are privileged from discovery in a proceeding is to be determined according to the provisions of the Evidence Act. A 'lawyer' in the Evidence Act means a barrister or solicitor. The effect of this was stated by the court to be as follows:

In the present case, the point is that the occasion of the privilege described by the Evidence Act does not specifically require anything more than admission to the status of lawyer for its operation.

Accordingly, Justice Crispin was in error in holding that legal professional privilege can only be established where the lawyer concerned holds a current practising certificate.

In drawing this conclusion, the court commented that the possession of a practising certificate can still be 'a very relevant fact' in determining whether an employed lawyer is acting in accordance with professional standards and the degree of independence necessary to maintain privilege under the Evidence Act. It is not, however, conclusive, as Justice Crispin had found.

Reliance on evidence subject to parliamentary privilege

In deciding at trial whether the relationship between the legal officers and their employer, the Commonwealth, had the necessary independence, Justice Crispin had before him evidence from Ms Jacqui Kelly given to a Senate Committee. No challenge was raised against the admission of this evidence at trial.

The Court of Appeal found that the evidence fell squarely within the definition of 'proceedings in Parliament' in the Parliamentary Privileges Act, and ought not to have been tendered or received in the trial. Although no objection had been raised at trial, the privilege was that of Parliament, and neither party could waive or consent to a waiver of it. The appeal was also upheld on this ground.

The court remitted the case to the trial judge for reconsideration.

What does this decision mean for you?

Confidential communications between a lawyer who is an employee of the client and who does not have a practising certificate do not now fall automatically outside the scope of legal professional privilege in the Evidence Act. It remains the case, however, that a practising certificate will be of substantial importance in establishing the statutory requirement of a confidential communication for the dominant purpose of providing legal advice, if a claim for privilege is challenged. Accordingly, to reduce the risk of privilege being undermined, maintaining a current practising certificate should be considered a requirement of in-house legal practice. 

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