The decision in ConocoPhillips Co v Chrysaor E&P Ltd(1) has shown that privilege is not necessarily lost when an opposing party has had access to the privileged material. The purpose and context of the access will lie at the heart of the court's decision if a claim to privilege is disputed.
The application arose in the context of litigation between a buyer and a seller of certain companies in the North Sea oil industry. The buyer was granted access to certain documents and emails during and after the sale – specifically, the email accounts of employees of the seller's subsidiaries, as they became employees of the buyer's subsidiaries. The email accounts were later copied to the buyer's subsidiaries wholesale, although the buyer did not examine them in detail.
The seller claimed legal professional privilege over certain documents within those email accounts. The buyer challenged this on the basis that confidentiality in the documents had been lost as against the buyer (rather than as against the whole world) as a result of the access to and copying of the email accounts. Both the seller and the buyer had access to the documents that were the subject of the application, which is somewhat unusual in the context of a privilege dispute, although the buyer had agreed not to examine them until the privilege dispute was resolved.
Confidentiality
Providing access to entire email accounts carries a high risk that confidentiality could be lost, but the question to be answered in this case was whether it had been lost. Confidentiality can be preserved impliedly (rather than simply expressly) and context is key to determining whether it has been successfully preserved.
The relevant provisions in the contractual agreements allowed for broad but not unlimited access to the documents in question. In particular, the contractual framework provided wholesale access (to ensure the efficient working of the underlying business) but not for any purpose, and not for the purpose of the subject litigation. As such, the confidentiality had been preserved.
Timing
The parties' respective solicitors had been in correspondence over this privilege issue in early 2020; on 19 February 2020 (over a year before the trial), the seller "put its position clearly and powerfully to the buyer". The court was satisfied that it had been clear to each party at this stage that there was a difference of position. The buyer, however, did not raise its challenge to the claim to privilege:
- after that correspondence;
- in the disclosure review document; or
- at the subsequent case management conference.
The application was not heard until approximately one month before the trial started in May 2021, which was so late that the court did not believe that it was reasonable, within the phrase "reasonable and proportionate", to grant the type of relief sought at this late stage in the litigation.
The court concluded that where the implications of granting an application would disrupt the preparation of both sides for trial, it was "just too late" to do so. It also reminded the parties that "it is part of the very purpose of case management in this court, to avoid that type of disruption as the parties approach a trial which is significant for both of them".
This decision reinforces the position that although wholesale access to material may be provided, parties must separately consider the purpose and prevailing circumstances in which such access is granted (which may impose express or implied confidentiality obligations), despite the free provision of access to material.
It is also a reminder that outstanding interlocutory skirmishes should be resolved well in advance of trial. Parties often trade correspondence on disclosure issues well before the final hearing, but this decision highlights the need to make applications at that stage, rather than in the scramble of late pre-trial preparation. The courts will take a dim view of belated applications, particularly when the respective positions have been clearly articulated for some time and where the issues were not raised before the court in the usual case management framework.
For further information on this topic please contact Jonathan Cary or Alexandra Shearer at RPC by telephone (+44 20 3060 6000) or email ([email protected] or [email protected]). The RPC website can be accessed at www.rpc.co.uk.
Endnotes
(1) ConocoPhillips Co v Chrysaor E&P Ltd [2021], 3 WLUK 524.