Issue: February, 2006
Author: John M. Burman
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Ethically Speaking - The Attorney-Client Privilege: Part II, Waiver and Exceptions
Ten years ago this month, a column entitled “Ethical Issues” appeared for the first time in the WYOMING LAWYER. In that inaugural column, I observed that “there is a need for some mechanism to make information about ethics available to attorneys.” At that time, no formal mechanism existed to request an ethics opinion from the State Bar. Although such a procedure now exists, at least in rule, I am not aware that it has been used, and it is unlikely that the procedure that was created as part of the 2003 amendments to the Disciplinary Code will be able to provide many opinions as the responsibility for drafting opinions was simply added to the host of obligations that Bar Counsel already shoulders.
In the first column, I wrote that my hope was to provide “a forum to raise and discuss ethical issues, and provide suggestions for additional research and guidance.” I recall telling my wife that I thought I would write the column for a few years, but I was not sure how long there would be issues to address. How wrong I was. Fifty-nine columns later (I have missed two issues), the supply of ethical issues seems to have grown. I am confident now in saying that I expect to run out of steam long before the supply of ethical issues about which to write is exhausted. And while I hope the columns are useful to you, I cannot tell you how much I’ve learned. Every time I sit down to write, I generally think I understand the topic, but I soon learn that I only think I understand it, I actually don’t. Writing these columns has, therefore, been an extremely valuable experience for me.
Before proceeding with this month’s topic, I want to thank the Wyoming Bar for its willingness to publish what now totals over a quarter of a million words about ethics–about topics that I generally choose, though I do get suggestions. I will report, too, that all the previous columns have been revised, expanded, and some new topics have been added, to a book to be entitled “Professional Responsibility in Wyoming.” The book is nearing completion and should be published this year, again courtesy of the Wyoming Bar.
Even with a willing publisher, an author needs an audience. I expected my main audience to be Wyoming lawyers and judges, and so it has been. But in this era of computer research, one needs to be careful what one writes. Imagine my surprise to learn that columns have been cited by the Florida Court of Appeals and the Ohio Supreme Court. So thank you all for reading. The last ten years have flown by, and I look forward to the next ten.
Loss of the Attorney-Client Privilege
The last article which appeared in what is now called “Ethically Speaking” addressed the basics of the attorney-client privilege. It ended with the following observation:
The protection of attorney-client privilege is far from absolute. Even when the privilege “has struggled into existence, it leads a fragile life.” [footnote omitted] The privilege may be lost through a waiver, or a communication may be subject to an exception. The next column will address those issues.
Although the privilege exists to promote important public policies (most notably, “to encourage full and frank communication between attorneys and their clients and thereby promote broader public interests in the observance of law and administration of justice.”), the privilege will yield to “strong public policy.” Since the privilege can be easily lost (generally referred to as “waived,” either intentionally or otherwise) and since it belongs to clients, lawyers need to know how and when that can happen, how to ensure that any waiver is done properly, and what they can do to prevent the privilege from being waived inadvertently. In addition, lawyers need to know which communications with a client are not subject to the attorney-client privilege at all because they fall within an exception.
The Attorney-Client Privilege Belongs to Clients, Not Lawyers.
As noted in the last column, the attorney-client privilege in Wyoming is codified in the Wyoming Statutes at § 1-12-101, and the statute is regrettably spare. One of the issues it does address, at least indirectly, is to whom the privilege belongs. “The attorney . . . may testify by express consent of the client . . . , and if the client . . . voluntarily testifies the attorney . . . may be compelled to testify on the same subject.
Saying that an attorney may testify with the “consent of the client” is tantamount to saying the privilege belongs to the client. Such a construction is in line with the general rule. “It is certainly true that the attorney-client privilege belongs to [the client] . . .”1 The client, therefore, or any authorized agent of the client, may waive the privilege. Authorized agents include the attorney for the client.
Waiver of the Attorney-Client Privilege
A waiver of the attorney-client privilege occurs when a communication which was or would have been privileged loses that status. And since the privilege belongs to a client, it stands to reason that the client should be the one to decide whether to waive it (as discussed below, waiver may occur as the result of the attorney’s actions, whether authorized or not). Any such waiver, as any decision involved in legal representation, must be an informed one.” If the client is an organization, the privilege belongs to the organization, which is the client. The decision of whether to waive it, therefore, lies with the governing body of the organization or “individuals empowered to act on behalf” of the organization. Since the privilege belongs to the organization, a “dissident director. . . has no authority to pierce or otherwise frustrate the attorney-client privilege when such action conflicts with the will of ‘management.’”
In order to make an “informed decision” about whether to waive the privilege, the client must understand what waiver means, that once waived the communication will likely never be privileged again, and what the alternatives are to waiver. Although not required by the statute in Wyoming, or in most jurisdictions, the advisement of the consequences of waiver, as well as the client’s consent thereto, should be in writing.
While a decision to waive the privilege should be an informed one, it often is not. Rather, the privilege is lost by the conduct of the client or the client’s lawyer. That conduct may be with the intent, or at least the understanding, that the privilege will be lost, or waiver may be an unintentional and even unwanted result of some action or inaction of the client or the lawyer. Conduct which may result in waiver is discussed below.
The Presence of a Third Party
The attorney-client privilege protects communications between an attorney and the attorney’s client. Communication of the same information to a third party, either directly or because that person was present during the communication with the client, generally destroys the privilege. The likely loss of the privilege because of the presence of a third party is probably the most common reason for waiver, and one about which lawyers need to be aware and explain to their clients.
Probably the most common situation which confronts lawyers is when a client wants to have his or her significant other attend a meeting with the lawyer. The presence of that person will likely open the door to the possibility of the significant other being asked about what the client said to the lawyer and vice-versa, and there will be no valid evidentiary basis for objecting to that question.
The client should not only be told of the effect of a third party’s presence, but also cautioned that repeating the lawyer’s advice to a third person may also result in waiver of the privilege. Even the presence of a client’s spouse may destroy the privilege, though “the effect of a spouse's presence on a communication between attorney and client is not entirely clear.” By contrast, if the client’s spouse is not present, and the client subsequently tells him or her of the communications with the lawyer, that subsequent communication is likely protected by the spousal privilege. If the client and the recipient of the subsequent communication are not married, however, no privilege exists for communications between significant others.
While a lawyer cannot prevent a third party from being present, or prevent a client from disclosing the lawyer’s advice to another, a lawyer should discuss with the client the consequences of either having another person present during their meetings or repeating the communications to another person. Such a conversation should take place just between the lawyer and the client, who can then make an informed decision about whether to allow another person to attend the meetings or whether the client should repeat the communications between the party and the lawyer.
Although “the presence of a third person ordinarily destroys the confidentiality required to assert the attorney-client privilege, that destruction ‘does not always occur when a person other than client and lawyer becomes a party to the communication if that person is needed to make the conference possible.’” The question becomes, therefore, whether the third party’s presence is necessary to facilitate the communication between the client and the lawyer. If so, such a person is known as a “confidential agent for communication.”
In determining whether a third party is a “confidential agent,” courts should consider “the customary relationship between the client” and the other person, “the nature of the communication, and the client’s need for the third person’s presence to communicate effectively with the lawyer or to understand” the lawyer. Language interpreters are probably the most common “confidential agents for communication.” Other types of interpreters, such as a person to assist communication between a developmentally disabled client and that client’s lawyer, may be just as important, and their presence should not destroy the attorney-client privilege.
If the third party is also a client, communications between the lawyer and either client will be protected under the so-called “joint defense privilege.” Under this doctrine, “[w]here two or more persons employ an attorney as their common attorney, their communications to him in the presence of each other are regarded as confidential so far as strangers to the conference are concerned . . .” With respect to waiver of the privilege, all the clients (or former clients) must agree: “[W]here several persons employ an attorney and a third party seeks to have communications made therein disclosed, none of the several persons--not even a majority--can waive this privilege . . .”
The “joint defense” or “common representation” doctrine also applies to multiple parties with separate attorneys. As a result, one attorney for one client may disclose otherwise privileged communications to another attorney for another client without waiving the privilege. In the words of one court, “the disclosure of privileged information by an attorney to counsel of actual or potential co-defendants does not constitute a waiver of the attorney-client privilege based on the joint defense exception.”
Disclosure to a Third Party
As noted above, “[i]t is a well-established principle of law that the attorney-client privilege is lost if the client discloses the substance of an otherwise privileged communication to a third party” Such subsequent disclosure is particularly common in domestic relations cases where a client seeking a divorce discloses his or her communications with the lawyer to a new significant other. Such a disclosure is generally not privileged and will result in the loss of the privilege, meaning that the attorney for the other party may inquire about the non-privileged subsequent disclosure. And while a lawyer cannot prevent a client from such disclosures, the lawyer should advise the client of the consequences of a subsequent disclosure.
Failure to Object
Rule 1.6 of the Wyoming Rules of Professional Conduct, the rule which defines a lawyer’s ethical duty of confidentiality, “requires the lawyer to invoke the [attorney-client] privilege when it is applicable..” After raising the objection, the lawyer “must [then] comply with the final orders of a court or other tribunal . . . requiring the lawyer to give information about the client.” The reason for the obligation to object is simple. The “failure to timely object to the questioning or to take reasonable measures to halt the disclosure of privileged communications waive[s] the privilege.”
The Wyoming Rules of Civil Procedure govern discovery in civil cases, and they specify how and when evidentiary privileges are to be raised, as well as the consequences of failing to raise them. As a general matter, a party may discover any matter that is “non-privileged” and which is either relevant or “reasonably calculated to lead to the discovery of admissible evidence.” If the matter is privileged, therefore, it may be withheld. The Rule goes on to specify how claims of privilege are to be made.
A party who does not produce information because it is privileged may not simply withhold it. Rather, “the party shall make the claim [of privilege] expressly.” Further, the party must “describe the nature of the documents, communications, or things not produced or disclosed in a manner that, without revealing information itself privileged or protected, will enable other parties to assess the applicability of the privilege or protection.” Accordingly, “when a party wishes to assert privilege in response to a discovery request he or she must notify the party seeking disclosure by providing a privilege log identifying the documents withheld and explaining the privilege claim.” The reason for requiring a privilege log is to permit the other party and the court to evaluate whether the privilege actually applies.
If there is a dispute over whether the privilege applies, the party withholding the desired information “‘bear[s] the burden of establishing that [the privilege] applies.’” To carry that burden, the objecting party “must provide sufficient information to enable the court to determine whether each element of the asserted privilege is satisfied.’” Although the Wyoming Statute does not include the absence of waiver as an element of the statutory attorney-client privilege, some courts have held that a party seeking the protection of the attorney-client privilege must prove that the privilege has not been waived, and that the failure to do so results in waiver of the privilege.
Assuming the privilege is upheld during discovery, the party seeking its protection must be alert to renew the objection at trial if the issue resurfaces. As noted above, the “failure to timely object to the questioning or to take reasonable measures to halt the disclosure of privileged communications waive[s] the privilege.”
Assertion of a Good Faith Defense
Sometimes a defendant claims as a defense that he or she acted in good faith. Such a defense is, essentially, a claim about an individual’s state of mind. The claim is often that the defendant could not have had the requisite bad intent because he or she was acting in reliance on the advice of counsel (in a malicious prosecution case, for example, it is a defense that the defendant sought, received, and relied in good faith on the advice of competent counsel). Raising such a defense puts the communications between a lawyer and the defendant (the lawyer’s client or former client) squarely at issue. Not surprisingly, asserting such a defense has been found to be a waiver of the attorney-client privilege that normally protects such communications. The reason is that the only way to assess the truthfulness of such a defense is to inquire into what the defendant was told by his or her lawyer.
The scope of the waiver depends primarily on the nature of the defense. Where the defense involves only a particular communication, the waiver “extends to the remainder of the particular communication at issue.” Where, however, the defense involves the lawyer’s involvement in general, “the magnitude of the waiver must be proportionately larger.”
Putting Legal Advice at Issue
Just as asserting a defense of good faith reliance on legal advice waives the privilege, it is also waived “for any relevant communication if the client asserts . . . the client acted upon the advice of a lawyer . . . or a lawyer’s assistance was ineffective, negligent or otherwise wrongful.” The reason for this rule is fairness. “If the communication [between the lawyer and the client] could not be introduced, a client could present the justification of legal advice in an inaccurate, incomplete, and self-serving way.” Accordingly, “[i]n situations where an attorney or client charges the other with a breach of duty, it would be unjust for a party to that relationship to maintain the privilege so as to preclude disclosure of confidential communications relevant to the issue of breach.”
In Bankruptcy, the Power to Waive the Attorney-Client Privilege Passes to the Trustee.
Normally, the authority to waive the attorney-client privilege belongs to the client, who is the owner of the privilege. If the client declares bankruptcy, however, that authority passes to the trustee, who is appointed to act on behalf of the bankrupt.
Waiver by an Attorney
As discussed above, the attorney-client privilege belongs to clients. It is, therefore, clients who have the right to waive the privilege. Waiver may be done either directly by a client, or indirectly, through the acts of an agent. As every attorney is an agent for every client, attorneys have either actual, implied, or apparent authority to waive the privilege on behalf of their clients (the principals).55 Accordingly, the general rule is that the right to waive the privilege may be exercised by “the client [or] the client’s lawyer.”
Ideally, an attorney obtains express authority from a client before waiving the privilege. Such authority may also be implied from a client’s actions or words. The basis for finding implied authority to waive the privilege is that an attorney has “‘implied authority from the client . . . to make admissions and otherwise to act in all that concerns the management of the cause . . .’” Part of that implied authority is, as discussed above, that a lawyer may waive the privilege by failing to properly and timely object.
Finally, as any agent, an attorney has at least some apparent authority to act on behalf of a client, the principal. Generally, “[a]pparent authority is created when the principal holds the agent out as possessing the authority to bind the principal or when the principal allows the agent to claim such authority.” As applied to the attorney-client relationship, the act or an attorney is deemed to be that of the client “if the tribunal [before which the lawyer is appearing on behalf of the client] or third person [with whom the lawyer is dealing] reasonably assumes that the lawyer is authorized to do the act . . .” Therefore, those with whom a lawyer are dealing can and will reasonably assume that the lawyer has authority to act on behalf of the client in virtually all aspects of the representation. As a consequence, a lawyer will likely have apparent authority to do many things, including waiving the attorney-client privilege.
Exceptions to the Attorney-Client Privilege
Although the attorney-client privilege generally protects communications between an attorney and the attorney’s client, that is not always the case. Two generally recognized exceptions remove certain communications from the privilege’s protection. In addition, some communications are generally not considered privileged.
The identity of a client, information about fees, and the general nature of the work for which a lawyer was retained are usually not privileged. Accordingly, correspondence, bills, ledgers, statements and time records are only privileged when they indicate the motive of the client, litigation strategy, or the specific nature of the services provided by the lawyer.
The exception to the exception which protects a client’s identity in narrow circumstances is the so-called “last link” doctrine. It applies when the client’s identity “may well be the link that could form the chain of evidence necessary to convict the individual of a federal crime.”
The Crime-Fraud Exception
The crime-fraud exception removes from the protection of the privilege any communication “in furtherance of contemplated or ongoing criminal or fraudulent conduct.” “A party wishing to invoke the crime-fraud exception must demonstrate that there is a factual basis for a showing of probable cause to believe that a fraud or crime has been committed and that the communications in question were in furtherance of the fraud or crime.”
Determining whether the crime-fraud exception applies, and thus certain communications between a lawyer and a client are not protected by the attorney-client privilege, involves a two-step analysis. First, the court considers whether “the factual basis would strike a prudent person as constituting a reasonable basis to suspect the perpetration . . . . of a crime or fraud, and that the communications were in furtherance thereof.” Second, the court should conduct an in camera review; whether to allow the communication to be revealed is within the court’s discretion.
The Testamentary Intent Exception
Although the attorney-client privilege normally survives a client’s death, that is not always the case. In a contest about the validity of a will, the critical issue is often the capacity of the decedent. Perhaps no one is in a better position to testify about that issue than the lawyer who drafted and witnessed the execution of the will. Generally, however, an attorney’s observations about his or her client are covered by the attorney-client privilege. An exception is often made to allow an attorney to testify about his or her observations about the testator’s capacity even though the testator is not available to give consent.
The purpose of the testamentary exception is “furthering the testator's intent.” The idea, of course, is that testimony which supports the capacity of the decedent, and thereby supports the probate of a client’s last will and testament, will further the client’s intent. Accordingly, “[t]here is a testamentary exception to the posthumous survival of the attorney client privilege in regard to communications respecting the execution of will or other similar documents.”
We end where we began. “Even when the privilege ‘has struggled into existence, it leads a fragile life.’” Both clients and attorneys must, therefore, be careful to preserve it or lose its protection. Since a client is unlikely to understand the privilege or how it can be lost, the burden is on the lawyer to explain both. Only after an appropriate explanation can a client make an informed decision about whether to waive the privilege. Attorneys must be careful, also, not to inadvertently waive the privilege, either through unauthorized disclosures, for which the lawyer likely has either implied or apparent authority, or through failing to object when necessary.
Clients also need to be told about the exceptions to the privilege, especially the future crime one. The reason for such an explanation is that clients are entitled to know if and to what extent their communications with their lawyers are privileged. A client is entitled, therefore, to know about both the existence of the privilege (and the related ethical duty of confidentiality), as well as exceptions to it. Advising a client that certain communications may not be privileged may result in the client not disclosing some information to the lawyer. It is far better, however, for a client to know the effect of his or her statements than to have a lawyer say, after the fact, that a disclosure is not privileged and will be revealed. Such a statement defeats the client’s reasonable expectations of privacy and is likely to lead to a grievance.
Much of attorneys’ work does not involve communications with clients. It is not, therefore, protected by the attorney-client privilege. Rather, it falls under the work-product doctrine. That doctrine will be the subject of the next column.
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