Collateral waiver of privilege: when voluntary disclosure results in a wider waiver

Summary

It is a widely known concept that a party who chooses to waive legal professional privilege (LPP) over certain documents in litigation (or parts of the documents) may find that the waiver extends further than the party intended. This is known as the “cherry-picking” rule. Underpinning this rule is the need to prevent a party from choosing to rely upon (by disclosing) favourable aspects of its otherwise privileged material, while avoiding disclosing less favourable aspects by continuing to assert LPP over documents or parts of them.

For the cherry-picking principle to be engaged, deliberate deployment must take place. If a collateral waiver applies, it only does so in respect of further privileged material that forms part of the same “transaction” or “issue”, where fairness dictates that a wider disclosure should apply so that the court has the full picture.

This principle has been examined recently by the High Court in Gorbachev v Guriev [2024] EWHC 622 (Comm). Specifically, the High Court held that a claimant’s waiver of privilege over a chronology prepared by his lawyer resulted in a collateral waiver of privilege in a later (and updated) version of the chronology, together with documents recording the claimant’s instructions to its lawyer in relation to the contents of the chronology.

Background

The wider and highly publicised case in question relates to the parties’ interests in one of the world’s largest fertiliser companies listed on the Moscow and London Stock Exchanges.

The aspect of the case relating to a collateral waiver of privilege concerned an application by the defendant for an order that determined the extent to which the claimant had waived privilege in respect of communications between the claimant and his legal advisors in relation to the preparation of a chronology dated on or before 30 January 2013.

The claimant’s then barrister, Mr Fitzgerald, prepared the chronology based on instructions he had received in meetings and over the telephone with the claimant. The claimant then instructed Boodle Hatfield a few months later, following which Mr Fitzgerald provided the chronology on 30 January 2013. The Claimant, representatives of Boodle Hatfield and Mr Fitzgerald then attended a meeting on 1 February 2013.The purpose of the meeting was to enable Mr Fitzgerald to share his knowledge and instructions. Mr Fitzgerald updated the chronology following the meeting and recirculated it to the claimant and Boodle Hatfield on 5 February 2013. It is understood that it was not amended thereafter.

Why was privilege initially waived?

The claimant argued that he had waived privilege in respect of the earlier chronology to meet a contention made by the defendant that the claimant’s account of events had changed since the outset of the case. The claimant wanted to demonstrate that his account of events had not changed by showing that the chronology and key facts aligned with instructions provided in 2012. The claimant therefore decided to waive privilege in relation to the first chronology for the purposes of demonstrating that he provided instructions to counsel in 2013 that were consistent with his case today.

The court’s approach to collateral waiver

In reaching its decision, the court concluded that it first needed to determine the issue to which the originally disclosed material was relevant, that is, the “actual transaction in respect of which disclosure is made” (per R (on the application of Jet2.com Ltd) v Civil Aviation Authority [2020] EWCA Civ 35; [2020] QB 1027). If, from this, it appeared that there were wider issues at play, then the court recognised that fairness may dictate that further disclosure should take place beyond what was previously ordered to be disclosed. This is to ensure that all material relevant to a particular issue is disclosed.

In the present case, the court considered the purpose for which the chronology was initially disclosed, which was to demonstrate consistency in the claimant’s case over a time period. HHJ Pelling KC determined that the issue to which the chronology was said to be relevant was whether the version of events pleaded in the claim was consistent with instructions provided by the claimant at the outset, particular in relation to the preparation of the chronology.

The defendant contented that at least the updated chronology would need to be disclosed to prevent the obvious risk of a misleading picture being given in relation to the original disclosure. The claimant disagreed with the defendant’s rationale and argued that the updating of a chronology was a separate process.

The judgment

HHJ Pelling KC agreed that not providing a later draft of a document (in this case, a chronology) risked giving a misleading impression as to the consistency of the claimant’s case. The judge found that it was “close to obvious” that if instructions were given shortly after the chronology was created for the purpose of its material alteration, then the chronology could not be considered as anything more than a “developing draft”. To disclose an earlier draft without disclosing the later version risked depriving the defendant of the opportunity of satisfying himself that what the claimant had chosen to release represented the whole of the material relevant to the issue.

While the claimant argued that the later chronology did not relate to the process of providing instructions for preparing the chronology, the court found that this “missed the point”, because the issue in question was not whether the chronology reflected instructions down to the date it was prepared, but whether the chronology was consistent with the claimant’s overall pleaded case.

Throughout the hearing, it became apparent that attendance notes and material relating to this chronology would have been circulated and so the court considered whether these would need to be disclosed. It was the judge’s view that attempting to identify specific documents or classes of documents in relation to this would result in error or omission. The court therefore ordered that the claimant must disclose the updated chronology and all documents that contained, recorded or otherwise evidenced instructions concerning the contents of the chronology and its updated iterations. This included any documents that corrected the updated version circulated on 5 February 2013. The defendant accepted that, to the extent any such documents contained privileged material that was not relevant to the issue in question, they should be redacted.

Comment

This case serves as a useful reminder that the colloquially known “cherry-picking” rule is highly fact sensitive and depends on the purpose of the waiver and the issues at play. Therefore, when considering whether to waive privilege over a document, parties should always carefully assess the risks of doing so and specifically, whether this might extend the waiver beyond what was intended and, importantly, how far. In this regard, it is necessary to determine what the relevant ‘transaction’ is. Otherwise, parties may find themselves triggering a waiver of a much greater pool of privileged documents than anticipated or intended.

This document is published by Practical Law and can be found at: uk.practicallaw.tr.com/w-043-4351