The Journal of The DuPage County Bar Association

Back Issues > Vol. 29 (2016-17)

“I Can’t Tell You” – Privilege, Confi dentiality, And The Compulsion of Testimony From the Transactional Lawyer
By Mark T. Schmidt

The transactional lawyer serves her or his client by presenting options through the creation of documents, by explaining what could go right – and wrong – if a certain path is followed, and by thoughtfully responding to client questions, concerns, and fears. Attorney-client discussions in such settings are most often confidential, and generally never see the light of day after a transaction has been consummated, or has fully and finally fallen apart. What if these discussions could be mined, as it were, by those who have involved the attorney’s client in litigation? What if these discussions were accessed years and even decades later in a litigation setting? This article explores the nature and number of tools that the law provides, to both client and to counsel, and which assist the practitioner in protecting himself and the information he possesses. The article will also make some gentle suggestions concerning what the transactional lawyer might do to prepare for the unusual possibility that she will be questioned or deposed about a transaction which occurred months or even years ago.

Applicable Privileges and Professional Obligations. Three privileges or protections play a prominent role in what the transactional lawyer may do, and what he must do, when it comes to protecting or disclosing the facts and the particulars of a matter or transaction involving the attorney and the client. Understanding how the attorney-client privilege, the work product doctrine, and the Rules of Professional Conduct operate will assist the practitioner in identifying what is to be protected, and in determining how it is to be protected. Attorney-Client Privilege: The attorney-client privilege is classically defined in this fashion: (1) where legal advice of any kind is sought, (2) from a professional legal advisor in his capacity as such, (3) the communications relating to that purpose, (4) made in confidence, (5) by the client, (6) are at his instance permanently protected, (7) from disclosure by himself or by the legal advisor, (8) except the protections can be waived.1, 2

Note that the scope of the privilege concerns communications between attorney and client. The privilege is intended to promote full and frank disclosure by removing the fear that disclosure of information will be compelled.3 As the privilege is in derogation of a client’s general duty to disclose, it is narrowly construed. Further, the attorney-client privilege’s application is limited to those communications which the client expressly made confidential, or that she reasonably could expect to be viewed as confidential.4

The attorney-client privilege’s power comes from its permanency. Communications protected by the privilege, for example, do not become publicly available after a criminal prosecution, a civil suit, or a transaction has concluded.5 Such communications are protected by a privilege that is owned by the client, not by his counsel.6 Still, the burden of presenting facts which give rise to the privilege, though placed on the client,7 will most likely be the attorney’s burden, in the first instance, to bear.

While the attorney may be authorized to discuss matters protected by the privilege, the privilege must, in the first instance, be knowingly and voluntarily waived by the client.8

Work Product Privilege: The work product privilege, often identified not as a privilege, but as a doctrine, is recognized by the Rules of the Supreme Court of Illinois and in the Federal Rules of Civil Procedure. Illinois provides, by Rule, that “materials prepared, by or for a party, in preparation for trial, are subject to discovery only if it does not contain or disclose the theories, mental impressions, or litigation plans of the party’s attorney.”9 The federal approach is broader in scope, but conditional in the protection it affords. Federal Rule of Civil Procedure 26(b)(3)(A) begins as follows: “Ordinarily, a party may not discover documents and tangible things that are prepared in anticipation of litigation or for trial or for another party or its representative (including the other party’s attorney, consultant, surety, indemnity or, insurer or agent)”. However, the Rule continues by noting that even these items might be discovered by an opposing party if they are otherwise discoverable (that is, if the information sought is reasonably calculated to lead to the discovery of admissible evidence) and if the party seeking the discovery shows both that the party has substantial need for the materials to prepare its case, and cannot, without undue hardship, obtain the substantial equivalent of the information sought by other means. FRCP 26(b) (3)(A). Unlike the attorney-client privilege, which belongs to the client, the work product doctrine is owned by the attorney, and is the attorney’s to invoke or waive.10

Indeed, when either an attorney or a client terminates the relationship, and the client requests its file, support exists for the principle that the attorney has no obligation to turn over her or his notes.11

The work product privilege (as described by the State and Federal Rules referenced above) affords protection to confidential matters because of the relationship such confidential matters have to litigation, either actual litigation (in the case of Illinois) or both actual and anticipated litigation (in the case of the  federal system).12 Illinois protects the theories, mental impressions, and litigation plans of a party’s attorney, but if, and only if, they are prepared in preparation for trial. It may be argued that Illinois’ Rules of Evidence also touch upon the work product privilege and expand it in a slight fashion. In identifying it as “work product protection,” the Illinois Rules of Evidence define this concept to mean “the protection that applicable law provides for tangible material (or its intangible equivalent) prepared in anticipation of litigation or for trial.”13 By way of contrast, the federal approach protects materials prepared by or for a party, without regard to whether they were prepared by a party’s attorney, its insurer, its agent, or its consultant or surety.

The work product protection afforded in the federal system is not restricted to those items which disclose an attorney’s theories, mental impressions, or litigation plans; in Illinois, the materials must contain the attorney’s theories, mental impressions, or litigation plans. Illinois’ work product protection, as expressed in Supreme Court Rule 201(b), is generally viewed as absolute, though the Supreme Court has crafted an exception where attorney notes and memoranda constitute the only source of factual material (Consolidation Coal Company v. Bucyrus-Erie Company, 89 Ill. 2d 103 at 110, 111 (1982)). The protection afforded by the Federal Rules of Civil Procedure, by way of contrast, may be eliminated if the party seeking disclosure makes the necessary showings of substantial need and the unavailability of equivalent sources and materials (FRCP 26(b)(3)(A)).

Does the work product privilege/doctrine both predate the rule schemes discussed above and protect an attorney’s theories and mental impressions in a transactional setting?

The case of Hickman v. Taylor,14 and the opinions released in that case by both the United States Circuit Court of Appeals and the Supreme Court of the United States, suggest that the concept that an attorney has the right to protect her or his theories and mental impressions may be part of the common law that predates both the Rules of the Supreme Court of Illinois and the Federal Rules of Civil Procedure.

In Hickman, the trial court ordered that defendant’s counsel, inter alia, reduce oral statements he obtained during his investigation to writing, and ordered that these attorney-created documents be produced to opposing counsel. When defendant and its counsel refused, the trial court held defendant and its attorney in criminal contempt of court. An appeal followed.

The Third Circuit Court of Appeals did test the actions of the trial court against the then newly-created Federal Rules of Civil Procedure. However, the justices placed the discussion of the rights of an attorney to protect information in a larger context. Circuit Judge Goodrich expressed concern that the trial court’s interpretation of the Rules would adversely impact the attorney-client relationship.15 In reversing the trial court, and vacating the contempt finding, the circuit court noted that what was to be protected in such context were “the results of the lawyer’s use of his tongue, his pen and his hand, for his client.” This the court identified as “the work product of the lawyer,...”16 The court held that the Federal Rules could not be interpreted to require discovery in violation of a doctrine which it identified as “sound policy,” and a policy that was “irrefutably established in the law.”17

The Supreme Court of the United States affirmed the Circuit Court decision in which it, too, described the work product doctrine in expansive terms. In affirming, the Court acknowledged that allowing an attorney’s thoughts and work product to be discovered would be devastating: “An attorney’s thoughts, heretofore inviolate, would not be his own. Inefficiency, unfairness and sharp practices would inevitably develop in the giving of legal advice and in the preparation of cases for trial. The effect on the legal profession would be demoralizing, and the interests of the client and the cause of justice would be poorly served.”18

Rule of Professional Conduct 1.6: The Rules of Professional Conduct, and specifically, RPC 1.6, covers areas protected both by the attorney-client privilege and the work product doctrine, but operates outside the exclusive or predominant control of either the attorney or the client. This Rule provides, in pertinent part, as follows: “(a) a lawyer shall not reveal information relating to the representation of a client unless the client gives informed consent, the disclosure is impliedly authorized in order to carry out the representation, or the disclosure is permitted by paragraph (b) or required by paragraph (c).”19 Illinois Rule of Professional Conduct 1.6(a). For purposes of this article, it is to be noted that Rule of Professional Conduct 1.6 (b)(6) provides that a lawyer may reveal information relating to the representation of a client in order to comply with a court order.

Although often associated with the attorney – client privilege, only, Rule 1.6(a)’s coverage is broader, and its prohibitions more mandatory and all inclusive, than the attorney-client privilege. The Rule provides that a lawyer shall not take steps which violate the Rule.20 The use of the term “shall,” in this setting, represents an imperative.21 The practitioner thus enjoys neither discretion nor options – she must, in the first instance, categorically refuse a request for the disclosure of information relating to the attorney-client relationship. It, thereafter, becomes the responsibility of the party soliciting such information to take such additional steps as he thinks necessary, such as the filing of a motion seeking an order compelling disclosure.

Rule 1.6 prohibits the disclosure of information which is identified as “relating to” the representation of a client. This establishes a category of data which is far broader than simply communications between attorney and client, or documents and electronically stored information which reflects the theories, mental impressions, or litigation plans of an attorney. As noted in the Comments to Rule 1.6: “The confidentiality rule, for example, applies not only to matters communicated in confidence by the client but also to all information relating to the representation, whatever its source...” “Paragraph (a) prohibits a lawyer from revealing information relating to the representation of a client. This prohibition also applies to disclosures by a lawyer that do not in themselves reveal protected information but could reasonably lead to the discovery of such information by a third person.” Illinois Rule of Professional Conduct 1.6, Comments [3], [4]. Thus, the plain language of the Rules of Professional Conduct, as illuminated by the comments relating thereto, make clear that an attorney’s duty of confidentiality applies, without restriction or limitation, to all information relating to the representation. The Rules do not carve out an exception which would allow the attorney to discuss what she thought about a document, what others mentioned during a transaction, or what problems or challenges he might associate with one or more sets of circumstances.

While the attorney-client privilege and the work product doctrine may be said to be controlled by the client and the attorney, respectively, the same may not be said of the duty of confidentiality embodied in RPC 1.6. It is more appropriate to characterize the protections described in that Rule as being broadly controlled by the Supreme Court, and more particularly controlled, in any given instance, by a trial judge. Because of the mandatory nature of the obligations imposed upon the attorney by the Rules, an attorney must, in the first instance and in the absence of client consent, refuse to answer any questions posed by a third party and relating to the representation of a client.

This will, in some instances, cause the third party to seek the assistance of a jurist. Such assistance will generally take the form of a motion to compel or, if the attorney has not filed an appearance and responded to a deposition or trial subpoena, of a motion for the issuance of a rule to show cause seeking a finding of criminal or civil contempt. This makes prudent an analysis of what the practitioner might do in advance to protect his thoughts and impressions, serve the client, and comply with the Rules of the Supreme Court.

What To Do? A Series of Gentle Suggestions. It is prudent to consider what the practitioner may do, and must do, before, during, and after her or his representation of a client. There are steps a practitioner may take which will enhance his or her ability to protect the content and confidentiality of the work done for a client.

Describe the Representation: While more difficult in circumstances where an attorney represents a client on an ongoing basis, the use of a written engagement agreement allows the attorney to clearly set the scope of the representation, and to establish the representation’s temporal boundaries. Where possible, it is advisable to identify, in the engagement agreement, whether litigation is anticipated. The practitioner should remember that her or his theories and mental impressions might well be protected if and only if they relate to or are prepared in anticipation of litigation. At the end of the representation, a letter or communication directed to the client and noting that the representation has been concluded will assist any later analysis which attempts to establish the scope and the parameters of the services the attorney has provided.

Think in Broad Terms and Act in a Precise Fashion: It is highly recommended that the attorney hire counsel when she or he first becomes aware that a third party is seeking access to thoughts and data protected by the privileges, doctrines, and Rules discussed above. Thereafter, it is both sensible and appropriate to make contact with the client, the client’s attorney, and the attorney or agent seeking disclosure of the protected information. Such contacts will, by necessity, seek more information than they disclose, because the right to disclose the information sought may well be prohibited by virtue of the attorney-client privilege, the work product doctrine, or the Rules of Professional Conduct. The Attorney Registration and Disciplinary Commission will accept calls from attorneys who have questions about the rules of professional conduct and their application to a given set of circumstances.

Evaluate What May Be Done and What Should Be Done: The practitioner, at this stage, faces an interesting set of issues and challenges. He or she should pose and answer a number of questions before any disclosure occurs. Has the former client given informed consent relating to attorney-client privilege and its waiver? Is it possible to access all documents relating to the areas of inquiry, or have they been destroyed or placed in an off-site storage facility? Is it prudent, knowing that a reviewed document which refreshes his recollection may be producible, to review writings which relate to the targeted transaction? Is the client’s interest in the attorney’s testimony related to supporting the transaction which occurred, or to suggest that the attorney departed from an applicable standard of care? Does this, standing alone, trigger an obligation to report the inquiry to the attorney’s errors and omissions carrier? Will the attorney be paid for the time associated with his work, and if so, by whom?

Gather Documents: Thereafter, the attorney (and, hopefully, the counsel the targeted attorney has retained) should begin the process, if possible and appropriate, of gathering documents already produced in discovery so that any preparation for a deposition may be conducted with such items in hand. Remember that document that refreshes recollection might be fair game for production, and that you may be a target as well as a witness insofar as the inquiry in question is concerned.
Recall, as well, that a deposition subpoena generally requires an attestation that the items produced are a response which is not only correct, but complete.

Consider Involving the Court: The writer has found it beneficial to appear before the court responsible for issuing a subpoena compelling an attorney to testify at the earliest possible point, and to remind the court that the attorney’s refusal to answer questions or to otherwise cooperate in the disclosure process is not a flight of fancy, but is a stance which the Supreme Court of Illinois, through its Rules, compels the attorney to take. It might be possible to obtain the trial judge’s assistance in defining the nature and scope of the inquiry, and in limiting its reach. For example, if a prior ruling has been made concerning the fact that the documents are unambiguous, it might be possible to request the court to restrict or prohibit inquiries on the issue of what the attorney thought about a clause, a phrase, or a document. Such an examination, it could be argued, would not be an inquiry concerning a “matter relevant to the subject matter involved in the pending action…”22 Regardless of the ruling the trial court makes on such issues, an open discussion with the court reminds all participants that a request for attorney documents and testimony concerns not a single case, but implicates, in a direct way, our system of justice and its ability to function in a way that is beneficial to the litigants, to the counsel they retain, and to the public at large.

1. Newton v. Meissner, 76 Ill. App.3d 479 at 498 (1st District 1979), citing People v. Adam, 51 Ill. 2d 46 at 48 (1972).
2. This discussion presumes that the attorney is representing a single party to a transaction. For a discussion of the doctrine of dual representation, and the hazards associated therewith, the reader is directed to Mueller Industries, Inc., v. Berkman, 399 Ill. App.3d 456 (2nd District 2010).
3. Waste Management, Inc., v. International Surplus Lines Insurance Co., 144 Ill. 2d 178 at 190 (1991); Janousek
v. Slotky, 2012 IL App. (1st) 113432, paragraph 22.
4. Janousek v. Slotky, ibid.
5. See, e.g., People v. Ryan, 30 Ill. 2d 456 (1964); Hitt v. Stephens, 285 Ill. App.3d 713 (4th Dist. 1997), appeal denied 172 Ill. 2d 551.
6. See, e.g., People v. Murry, 305 Ill. App.3d 311 (2d Dist. 1999), reheaing denied, appeal denied 185 Ill. 2d 653.
7. Fox Moraine, LLC, v. United City of Yorkville, 2011 IL App. (2nd) 100017, paragraph 63.
8. See Footnote 6.
9. Illinois Supreme Court Rule 201(b). See also Illinois Rule of Evidence 501, and Illinois Rule of Evidence
502.
10. Federal Rule of Civil Procedure 26(b)(3)(A).
11. ISBA Advisory Opinion on Professional Conduct, Op. No. 94-13 (January, 1995) (aff’d by ISBA Board of Governors, May, 2010.
12. Illinois does recognize the insurer-insured extension of the attorney-client privilege. See, e.g., Exline v. Exline, 277 Ill. App.3d 10 (2d Dist. 1995). In actual practice, an insurer-insured extension of the attorney-client privilege does afford some protection to materials prepared in anticipation of litigation, but by an insurer or an insurer’s agent or adjuster. Further discussion of these concepts is beyond the scope of this article.
13. While Illinois Rule of Evidence 502(f) defines work product protection to mean protection that the law provides “for tangible material (or its intangible equivalent) prepared in anticipation of litigation or for trial,” Illinois Rule of Evidence 501 seems to suggest that the work product doctrine both falls within the definition of a privileged area, and is to be governed “by the principles of the common law as they may be interpreted by Illinois courts in light of reason and experience.” Illinois Rule of Evidence 501.
14. 153 F.2d 212 (3d Cir. 1945), 329 U.S. 495 (1947).
15. 153 F.2d 212, 219, 220 (3d Cir. 1945).
16. 153 F.2 212,223 (3d Cir. 1945).
17. 153 F.2 212, 223 (3d Cir. 1945).
18. Hickman v. Taylor, 329 U.S. 495, 511 (1947).
19. IL R S Ct. RPC 1.6(a).
20. IL R S Ct. RPC 1.6(a).

21. IL R S Ct. RPC 1.6, Comments [2], [3], [4].
22. IL R S Ct. 201(b)(1).
22. IL R S Ct. 201(b)(1).

Mark T. Schmidt is the President of Schmidt & Barbrow, P.C., located in Wheaton. Mr. Schmidt received a B.A. in Communications from the University of the Pacific, and a Juris Doctor degree from the University of Illinois, where he won the Rickert Award and the Waterman Prize for Excellence in Moot Court.Schmidt & Barbrow concentrates its practice in six areas, including the litigation of chancery, professional, and business matters.

 
 
DCBA Brief