Smurfit Paribas Bank Ltd v A.A.B. Export Finance Ltd

• Jurisdiction: Ireland
• Judge: FINLAY C.J.,McCarthy J.,
• Judgment Date: 15 February 1990
• Neutral Citation: 1990 WJSC-SC 1274
• Court: Supreme Court
• Docket Number: [S.C. No. 138 of 1989]
• Date: 15 February 1990

SMURFIT PARIBAS BANK LTD v. AAB EXPORT FINANCE LTD

BETWEEN

SMURFIT PARIBAS BANK LIMITED

Plaintiff/

Respondent

and

AAB EXPORT FINANCE LIMITED

Defendant/

Appellant

1990 WJSC-SC 1274

Finlay C.J.

Walsh J.

McCarthy J.

138/89

THE SUPREME COURT

Synopsis:

PRACTICE

Documents

Discovery - Inspection - Privilege - Solicitor and client - Correspondence - Legal advice neither sought nor given in documents - Relevant documents not privileged - Test of public interest in the administration of justice - (138/89 - Supreme Court - 15/2/90) - [1990] 1 I.R. 469 - [1990] ILRM 588

|Smurfit Paribas Bank v. AAB Export Finance|

Citations:

SMITH-BIRD V BLOWER 1939 2 AER 406

MURPHY V DUBLIN CORPORATION 1972 IR 215

ANDERSON V BANK OF BRITISH COLUMBIA 1876 3 CH D 644

GREENOUGH V GASKILL 1833 1 MY & K 98

MINTER V PRIEST 1929 1 KB 655

SMURFIT PARIBAS BANK LTD V AAB EXPORT FINANCE LTD UNREP HIGH 1989/3/730

FINLAY V MURTAGH 1979 IR 249

COMPANIES ACT 1963 S173

MINTER V PRIEST 1930 AC 558 (HL)

1 JUDGMENT delivered on the 15th day of February 1990by FINLAY C.J.[WALSH CONC]

2 This is an appeal brought by the Defendant against an Order made in the High Court on the 13th March 1989 by Costello J. directing the further discovery of all correspondence or other instructions passing between the Defendant and the Solicitor then acting for the Defendant in relation to the Defendant's floating charge which is in issue in these proceedings. The Defendant had, upon the making of an original discovery in the case, claimed privilege for this correspondence and these otherinstructions.

3 The learned trial Judge reserved judgment on the motion brought by the Plaintiff for further discovery and then inspected the documents in respect of which the disputed claim for privilege had been made.

4 Having done so, he came to the conclusion

5 (a) That they did not request and did not contain any legal advice about the proposed transaction.

6 (b) That they contained references to the instructions which the Defendant's Solicitors received from the Defendant and further instructions and clarifications of instructions given by the Defendant to the Solicitors.

7 (c) That these instructions were given to enable the Defendant's Solicitors to draft the documentation necessary to complete the transaction which their client was entering into or to advise later on draft documents which other parties to the transaction might prepare for their consideration.

8 Having reached these conclusions as to the nature of the documents concerned with which, having inspected the documents on the hearing of this appeal, I agree the learned trial Judge then came to the conclusion that they were not privileged from disclosure andinspection on the following grounds.

9 (1) That they do not request and do not contain any legal advice.

10 (2) That they contain no information nor remarks that can be regarded as in any way being confidential.

11 (3) That they are statements of fact as to the transaction which the Defendants indicate they wish to have completed by the drafting of the necessary legal documents. In reaching that conclusion he placed reliance upon the decision of Smith-Bird v. Blower 1939 2 AER 406, in which a letter written to the Solicitors by a defendant, not for the purpose of obtaining legal advice, but in answer to an inquiry as to whether he had agreed to sell the property in question, was notprivileged.

The issues arising on this appeal

12 The issues which arise on this appeal raise important questions as to the principles underlying the claim of privilege properly applicable to communications between a client and his lawyers.

13 For the Appellant it is contended that privilege attaches to any communication made for the purpose of obtaining either legal advice or legal assistance,irrespective of whether or not litigation is in existence orcontemplated.

14 It is urged that no distinction can be supported by principle between a communication made for the purpose of obtaining legal advice and a communication made for the purpose of obtaining legal assistance.

15 It is further submitted on behalf of the Appellants that no difference exists between the nature and scope of privilege applicable where litgation exists or is contemplated and where it does not.

16 For the Respondent it is submitted that the principles laid down by the authorities support a restriction of privilege to communications made for the purpose of obtaining legal advice and do not support a privilege applicable to communications made for the purpose of obtaining legal assistance only. As an alternative submission it was urged on behalf of the Respondents that even if this distinction was not of general application it certainly applied to communications made otherwise than for the purpose of or in contemplation of litigation and that the communications consisting of the documents and instructions in dispute in this case came within that category.

The decision

17 For the purpose of determining which of these conflicting submissions is correct in law it is, in my view, necessary to try and ascertain what the underlying principles of the doctrine of privilege of communications between a client and his lawyers are.

18 The existence of some such privilege would appear to have been clearly identified at common law from the early nineteenth century.

19 However, the question as to whether or not a party to litigation will be privileged to refuse to produce particular evidence is a matter within the sole competence of the Courts: "Power to compel the attendance of witnesses and the production of evidence is an inherent part of the judicial power of government of the State and is the ultimate safeguard of justice in the State." Cf. Murphy v. The Corporation ofDublin 1972 IR 215 at p.233.

20 In the same case at p.234 the Court also held that it is for the Courts to decide which is the superior interest in the circumstances of the particular case and to determine the matter of privilege from disclosureaccordingly.

21 For a considerable period conflicting decisionsappear to have been reached at common law as to whether a privilege for communications between a client and his lawyer applied only where litigation was in existence or in contemplation or whether it also applied in relation to communications seeking legal advice where no litigation existed or was in contemplation. Before that conflict of decision appears to have been firmly resolved Jessel M.R. in Anderson v. The Bank of British Columbia 1876 3 Ch.Div. stated what he believed to be the underlying principle in the followingwords:

"The object and meaning of the rule is this: that as, by reason of the complexity and difficulty of our law, litigation can only be properly conducted by professional men, it is absolutely necessary that a man in order to prosecute his rights or to defend himself from an improper claim should have recourse to the assistance of professional lawyers, and it being so absolutely necessary, it is equally necessary, to use a vulgar phrase, that he should be able to make a clean breast of it to the gentleman with whom he consults with a view to the prosecution of his claim or the substantiating of his defence against the claim of others; that he should be able to place unrestricted and unbounded confidence in the professional agent and that the communications he so makes to him should bekept secret unless with his consent (for it is his privilege and not the privilege of the confidential agent) that he should be enabled properly to conduct his litigation: that is the meaning of the rule."

22 I would adopt this statement as far as it goes as identifying the requirement of the superior interest of the common good in the proper conduct of litigation which justified the immunity of communications from discovery in so far as they were made for the purpose of litigation as being the desirability in that good of the correct and efficient trial of actions by the Courts. In the case of Greenough v.Gaskill 1833 1 M.Y. and K. 98 which is usually accepted as the first identification of this particular type of privilege and which Jessel M.R. in the passage which I have just quoted is purporting to summarise Lord Brougham L.C. said, at p.102 of the Report:

"The protection would be insufficient if it only included communications more or less connected with judicial proceedings, for a person oftentimes requires the aid of professional advice upon the subject of his rights and his liabilities, with no reference to any particular litigation and without any other reference to litigation...