Property developers (‘GPR’) were suing their architects (‘FRP’) in negligence. The claim against FRP was covered by a professional indemnity insurance policy. Once FRP was notified of GPR’s claim, FRP sent a ‘notification of claim’ to its insurer pursuant to condition 4 of the policy. The notification to the insurer contained FRP’s views about the merits of the claim. The Court was now asked whether that notification was produced for the dominant purpose of litigation such that FRP was entitled to assert litigation privilege over it. FRP admitted that its dominant purpose, in sending the notification, was to comply with its obligations under condition 4 of the policy. GPR claimed that FRP could not assert litigation privilege in these circumstances because it was FRP’s dominant purpose, as the author of the notification, that mattered and FRP had accepted that its only purpose was to comply with condition 4.
Held: The Court of Appeal accepted the submissions of counsel for FRP that ‘the insurers will need to receive immediate notification . . so that they can set about obtaining legal advice’ and that ‘the letter owed its genesis to the dominant purpose that it should be used for the purpose of obtaining legal advice and in any ensuing litigation’
The Court was satisfied that it was appropriate to take into account, not just the dominant purpose of the insured who authored the document, but also the dominant purpose of the insurer on whose requirements the insured was acting in so doing.
‘I accept that the dominant purpose of the [notification] must be viewed objectively on the evidence, particularly by reference to the intentions of the insurers who procured its genesis. Subject to what is said below, I accept that, so viewed, the dominant purpose was to produce a letter of notification which would be used in order to obtain legal advice or to conduct or aid in the conduct of litigation which was at the time of its production in reasonable prospect ‘
Slade LJ referred to Nourse LJ’s judgment in Goddard, and said that the court ‘should ordinarily intervene in such cases, unless the case is one where the injunction can properly be refused on the general principles affecting the grant of a discretionary remedy.’
Judges:
Slade LJ
Citations:
[1987] 1 WLR 1027, [1987] CLY 3060
Jurisdiction:
England and Wales
Citing:
Cited – Goddard v Nationwide Building Society CA 1986
A solicitor had acted for both purchaser and lender in a purchase transaction. The purchaser later sought to recover from the defendant for a negligent valuation. The solicitor had however discussed the issue with the plaintiff before the purchase, . .
Cited by:
Cited – Mohamad Al Fayed v The Commissioner of Police of the Metropolis CA 29-May-2002
During an action, advice from counsel had been inadvertently disclosed to the claimants. The defendant sought to restrain use of the papers in the trial. It was accepted that the papers attracted legal professional privilege, but the police also . .
Applied – Derby and Co Ltd v Weldon (No 8) CA 27-Jul-1990
There had been a lengthy and contentious process of discovery. Certain documents with legal professional privilege had also been handed over inadvertently. The plaintiff sought their return and an order against them being used.
Held: The . .
Lists of cited by and citing cases may be incomplete.
Litigation Practice
Updated: 16 May 2022; Ref: scu.182969