Think before you write. It could come back to bite you

Year Published: 2014

We are all human, and from time to time we need to get issues off our chest. However once you commit something to writing and send it, you risk it becoming disclosable as evidence in a court case. This could be particularly damaging if the content has been written in the heat of the moment and is either unsavoury or discloses confidential and sensitive information about you or your business.

With this in mind I always advise my clients to consider the following when drafting a document and particularly a letter or email:

  1. Would I be happy if a judge read this?
  2. How would I come across?
  3. What impression would the content leave on the judge?
  4. Would I be happy for this information to be seen by intended third parties e.g. an opponent in a court case?

Keep in mind that one day this document could end up being reviewed by a judge or your opponent, particularly if it involves a contentious issue.

That said, not all documentation is disclosable and can attract privilege i.e. preventing it from being disclosed to your opponent and/or the judge.

There is plenty of case law and literature on the topic so it not appropriate here to venture into the depths of the world of privilege, however in short there are broadly two types:

  • Legal privilege – communications and documents between you and your solicitor for the purpose of obtaining legal advice;
  • Litigation privilege – communications and documents which are created when litigation is contemplated or pending.

However businesses can often fall foul of presuming their documents – particularly internal documents or those with non-solicitor third parties – are private documents and are protected from disclosure.

The recent case of Starbev GP Ltd v Interbrew Central European Holding BV (2013) demonstrates exactly this point.

Briefly the dispute related to the deferred consideration in the sale of a business, if the business bought was subsequently sold to a third party for an increased amount. The original seller (Interbrew) of the business believed that the subsequent sale had been structured to reduce the amount due to it. As a consequence court proceedings commenced.

During the proceedings the original buyer, Starbrev, sought disclosure of documents between Interbrew and advice they had received from Barclays and KPMG. Interbrew claimed that the documents attracted litigation privilege and therefore were not disclosable.

It was up to Interbrew to prove that the documents attracted litigation privilege; however they failed to establish that the dominant purpose of the documents was in contemplation of litigation. One of the main downfalls in Interbrew’s argument was that the work carried out by KPMG fell under their existing retainer, which did not include contemplated litigation. There was also no indication that litigation was in contemplation.

I suspect that Interbrew did not consider that the documents created with Barclays and KPMG may be disclosable in court proceedings in the future. If they did they could have taken action to improve their claim for litigation privilege, for example by making it explicit in the instructions that it was in contemplation of litigation, or in the case of KPMG, making it clear the instructions were beyond the existing retainer as they were in contemplation of litigation.

Finally in some instances it may be sensible to involve your legal advisors in communications or to lead any investigations. You may then be able to successfully claim legal privilege.

For further information on dispute resolution issues, please contact our dispute resolution team on 0161 475 7676.

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