Deception undermines the "dominant purpose" necessary for a claim to litigation privilege in the most recent instalment in the ongoing saga of Property Alliance Group Ltd v Royal Bank of Scotland Plc.
In the months before and after issuing its claim form, PAG's managing director had arranged meetings with two men who had previously worked for RBS. He led them to believe that he was interested in setting up business relations between PAG and their new companies. However, his real motive for arranging these meetings was to seek help in PAG's claim against RBS and he secretly recorded the meetings in the hope that they would yield evidence to support PAG's claim.
Legal advice privilege applies to communications between lawyer and client for the purposes of seeking, giving and receiving legal advice. Litigation privilege, however, can extend to a wider class of communications, including with third parties, provided that the dominant purpose of the communication is for use in litigation. It is not sufficient that litigation be simply one of the purposes of the communication, or even one of two equally important purposes.
What therefore was the dominant purpose of the discussion between PAG's director and the former RBS employees? The Court held that this was an objective question, which should take into account all the evidence, including what the parties involved said their intentions were.
The Court was clearly (and unsurprisingly) influenced by PAG's director's decision to deceive the two potential witnesses, describing it as the "critical point", and if this decision is limited to cases of deception, it may have limited impact.
However, the Court's decision to look at the intentions of both parties to discern the dominant purpose could have wider implications, as litigants may seek information to assist their case from a range of sources without necessarily actively disclosing (or concealing) the litigation. In those circumstances, on the Court's analysis here, those communications may not be protected by litigation privilege. The safer course will undoubtedly be for litigants to disclose the reason for the inquiry to anyone from whom information may be sought for the purposes of the litigation (and to hold any discussions on an expressly confidential basis). Whether that is practical, particularly in the context of regulatory enforcement, is another question.