London, WC2A 2LL
B e f o r e :
1) Digicel (St. Lucia) Limited (a company registered under the laws of St. Lucia)
2) Digicel (SVG) Limited (a company registered under the laws of St. Vincent & the Grenadines)
3) Digicel Grenada Limited (a company registered under the laws of Grenada)
4) Digicel (Barbados) Limited (a company registered under the laws of Barbados)
5) Digicel Cayman Limited (a company registered under the laws of the Cayman Islands)
6) Digicel (Trinidad & Tobago) Limited (a company registered under the laws of Trinidad & Tobago)
7) Digicel (Turks & Caicos) Limited (a company registered under the laws of Turks & Caicos)
8) Digicel Limited (a company registered under the laws of Bermuda)
- and -
1) Cable & Wireless Plc
2) Cable & Wireless (West Indies) Limited
3) Cable & Wireless Grenada Limited (a company registered under the laws of Grenada)
4) Cable & Wireless (Barbados) Limited (a company registered under the laws of Barbados)
5) Cable & Wireless (Cayman Islands) Limited (a company registered under the laws of the Cayman Islands)
6) Telecommunications Services of Trinidad & Tobago Limited (a company registered under the laws of Trinidad & Tobago)
Allen (instructed by Jones Day) for the Claimants
Lord Grabiner QC, Mr Edmund Nourse & Mr Conall Patton (instructed by
Slaughter & May) for the Defendants
Hearing date: 16 June 2009
Crown Copyright ©
MR JUSTICE MORGAN
"Without prejudice to the burden of proof, insofar as the claimants do identify particular individuals as having the relevant intention that can be attributed to particular defendants, as they should, the defendants' position is as follows:
(1) At least each of the following honestly believed, at all times material to the issues in any particular jurisdiction, that there was no obligation upon the relevant defendant in the particular jurisdiction to commence physical interconnection, in particular by ordering equipment and/or commencing civil works, until there was a concluded and/or approved interconnection agreement between the parties: Donald Austin, Clive Batchelor, Geoff Batstone, Errald Miller, John Thompson, Lawrence McNaughton, Rudy Ebanks, Lisa Agard, Carlos Espinal, Kurleigh Prescod.
(2) The defendants refer to the witness statements of the relevant individuals cited in this respect, which provide sufficient particulars to enable the claimants to understand the defendants' case.
(3) Insofar as it is held that the defendants' failure to order equipment and/or to progress physical interconnection was a breach of duty, the above mentioned individuals' honest belief to the effect that they were not acting in breach of duty is relied upon as showing that there was no intention to injure through unlawful means.
(4) At least each of the following honestly believed at all times material to the issues in any particular jurisdiction that there was no obligation in relation to interconnection with Digicel in any particular jurisdiction until Digicel had obtained a licence and/or concession in that jurisdiction: Donald Austin, Paul Barnes, Geoff Batstone, Nigel Fisher, Chris Forrest, Mark Macfee, Lawrence McNaughton, Glenda Medford, John Thompson, Rudy Ebanks, Derrick Nelson, Frans Vandendries, Lisa Agard, Carlos Espinal, Kurleigh Prescod.
(5) The defendants refer to the witness statements of the relevant individuals cited in this respect, which provide sufficient particulars to enable the claimants to understand the defendants' case.
(6) Insofar as it is held that the defendants' failure to commence negotiations and/or interconnection prior to the award of a licence to the relevant claimant was a breach of duty, the defendants rely upon [the] above mentioned individuals' honest belief to the effect that they were not acting in breach of duty as showing that there was no intention to injure through unlawful means.
(7) The defendants do not plead to schedule D, which is not a proper pleading, but argument, and mischaracterises the defendants' position."
"The claimants seek an order that the defendants shall give disclosure and inspection of documents constituting or evidencing legal advice which was given to or received by the individuals identified in the draft order attached regarding the lawfulness or otherwise under the laws of St Lucia, St Vincent and the Grenadines, Grenada or Barbados of the defendants' refusal or failure to commence negotiations or progress interconnection with the relevant claimant prior to the formal grant of a licence to the relevant claimant and/or the defendants' refusal or failure to order equipment required for interconnection with the relevant claimant prior to the signing and/or approval of an interconnection agreement between the relevant defendant and the relevant claimant. Alternatively, the claimants seek an order that the defendants shall give disclosure and inspection of documents constituting or evidencing such legal advice which the individuals identified in the draft order attached received from or were directly or indirectly given by Mr Geoff Batstone.
"The ground for the application is that the defendants have waived privilege in such legal advice in order to advance their alleged defence that each of the defendants (through the individuals identified in the draft order attached) held an honest belief at the relevant time as to the lawfulness of their refusal or failure to commence negotiations or progress interconnection prior to the formal grant of a licence to the relevant claimant and/or their refusal or failure to order equipment required for interconnection prior to the signing and/or approval of an interconnection agreement between the relevant defendant and the relevant claimant."
Paragraph 1(1) of the draft order reads as follows:
"Any documents constituting or evidencing legal advice given to or received by Mr John Thompson and/or Mr Lawrence McNaughton and/or Mr Chris Forrest and/or Mr Paul Barnes and/or Mr Nigel Fisher and/or Mr Donald Austin as to the lawfulness or otherwise of the refusal and/or failure of any of the defendants to commence negotiations and/or progress interconnection [with] any of the claimants prior to the formal award of a licence to the relevant claimant in relation to St Lucia, St Vincent and the Grenadines, Grenada or Barbados."
Paragraph 1(2) of the draft order reads as follows:
"Any documents constituting or evidencing legal advice given to or received by Mr John Thompson and/or Mr Lawrence McNaughton and/or Mr Clive Batchelor and/or Mr Donald Austin and/or Mr Errald Miller as to the lawfulness or otherwise of the refusal and/or failure of any of the defendants to order equipment required for interconnection with any of the claimants in advance of the signing and/or regulatory approval of an interconnection agreement between the relevant defendant and relevant claimant in relation to St Lucia, St Vincent and the Grenadines, Grenada or Barbados."
The Claimants' Submissions
The Narrow Submission
At paragraph 45 Mr Justice Elias referred to earlier cases where a distinction had been drawn between a reference to the contents of a document containing legal advice and the effect of such a document. It was stated that reliance on the contents of the document may amount to a waiver whereas reliance on the effect of the document would not.
At paragraph 64, Mr Justice Elias referred to the need for the court to form a view, first, as to the nature of what had been revealed and, secondly, the circumstances in which it had been revealed. In the latter regard, he distinguished between a reference to a document and reliance upon the document.
"In our judgment, it is an error to treat the earlier authorities as if the words falling from judicial lips had the sanctity of statute. We would not therefore adopt in quite such stark terms the contents/effects distinction which [counsel] submits represents the law. Plainly the fuller the information provided about the legal advice, the greater the risk that waiver will have occurred, but we do not think that the application of the waiver principle can be made to depend on a labelling exercise, particularly where the categories are so imprecise. The concepts shade into each other and do not have the precision required to justify their employment as rigid tests for defining the scope of waiver.
"Having said that, we do accept that the authorities hold fast to the principle that legal advice privilege is an extremely important protection and that waiver is not easily established. In that context, something more than the effect of the advice must be disclosed before any question of waiver can arise.
"However, in our view, the answer to the question whether waiver has occurred or not depends upon considering both what has been disclosed and the circumstances in which disclosure has occurred. As to the latter, the authorities in England strongly support the view that a degree of reliance is required before waiver arises but there may be issues as to the extent of the reliance. Ultimately there is the single composite question of whether, having regard to these considerations, fairness requires that the full advice be made available. A court might, for example, find it difficult to say what side of the contents/effect line a particular disclosure falls but the answer to whether there has been waiver may be easier to discern if the focus is on the question whether fairness requires full disclosure."
"In our view, the authorities demonstrate that reliance is necessary and there is currently no indication that the Council have any intention of relying on the advice. The disputed material was put before the court as an exhibit to a lengthy witness statement. The legal advice had not been specifically referred to in the pleadings, nor in the witness statements themselves, and in our view the mere reference to the advice, even to the contents of it, was not in the circumstances sufficient to constitute a waiver of privilege. The Council are not seeking to rely upon the advice to justify the reason why they decided to implement pay protection for a period of four years."
(1) Is there a reference to the legal advice? He submits if there is not, there is no waiver of any such privilege.
(2) If there is a reference to the legal advice, is there reliance on that legal advice? He submits if there is not, there is no waiver of privilege.
(3) If there is reliance on the legal advice, is the reliance on the contents of the advice or only on the effect of the advice? He submits that if the reliance is only on the effect of the advice, there is no waiver of privilege.
I do not think that at the end of the day there is any substantial difference between the parties as to Mr Patton's questions, save that Mr Rubin submits that the Brennan case has put its own gloss on the distinction between the contents of and the effect of a document.
Mr Rubin has taken me in detail and with care through a large number of witness statements. He submits that, having regard to the statements made as to the belief of various witnesses and the role of some of those witnesses in giving legal advice, I can infer that the case being put forward by the defendants is that the beliefs, as to the legal position, that are being relied upon by the defendants, are supported by legal advice given to those witnesses with the alleged beliefs. He submits that the consequence of this is that the defendants are deploying the legal advice in this litigation and have waived privilege in that advice.
Mr Rubin stresses that his submission relies upon the effect of the witness statements taken together rather than relying upon a particular reference here or there in a statement to the contents of legal advice.
In due course, Mr Patton, on behalf of the defendants, accepted in clear terms that in the absence of disclosure of the legal advice the defendants could not contend for such an inference in their favour.
Many of the statements so extracted simply record the fact that the legal advice was given. In accordance with settled principles, accepted by both parties on this application, a statement of that fact does not result in any waiver of privilege.
"As legal adviser, my role has included providing legal advice in the context of interconnection negotiations. Such advice is, of course, privileged and I understand that this privilege has not been waived. Consequently, when I refer to events and meetings below, I do not refer to the content of any legal advice that may have been given. On occasion, however, I do set out what my belief was as to the existence or extent of any obligations in relation to interconnection. In doing so, I do not seek to trespass on questions of statutory or contractual construction which I understand are questions for the court to determine after hearing legal argument. The only purpose of referring to my contemporaneous belief or understanding in this respect is to explain why I (or those with whom I was working) acted (or omitted to act) as we did. I understand this may be relevant given that it is alleged in these proceedings that the defendants pursued a strategy of deliberate and unlawful delay as regards interconnection."
Although this argument can be put, it is my view that this reference by Mr Batstone is not a sufficient reference to the contents of the advice nor reliance on such contents. The defendants have not crossed the ill-defined line which separates the contents of advice from the effect of advice so as to result in a waiver of privilege.
"RE: request for interconnection.
"We are in receipt of your letter of 14 May 2003 in which you requested interconnection with Cable & Wireless (Barbados) Limited.
"Notwithstanding that section 28(1) of the Telecommunications Act 2001 provides that a 'person' that wishes to interconnect with Cable & Wireless' network shall make a request in writing, it is Cable & Wireless' view that Part VI of the Telecommunications Act must be read in its entirety for an accurate interpretation of 'person' to be determined.
"We have been advised that person must be interpreted to mean a 'carrier' who has been licensed to own or operate a telecommunications network, and is therefore eligible to be provided with interconnection services pursuant to subsection 25(1) of the said Act which is the leading section. Any other interpretation would make nonsense of the legislation and would result in operating carriers being obligated to negotiate interconnection with parties who may have no intention or prospect of providing these services.
"We have also been advised that licences have not been issued to Digicel or any other identified new entrant. In addition, the regulatory framework for the liberalised environment remains incomplete.
"We are unable to accede to your request at this time and Cable & Wireless' position in its letter of 14 March 2003 stands.
"Cable & Wireless reserves its legal rights."
"Within a week, on 23 May 2003, Mr Austin replied on behalf of C&W Barbados explaining that in the context of the Act, the reference to 'person' should be read as a reference to a carrier. Mr Austin's letter (which I helped draft) noted that so far as C&W Barbados was aware, licences had not been issued to Digicel Barbados or any other new entrant. In addition, the regulatory framework for the liberalised environment remained incomplete. Mr Austin explained that, for these reasons, C&W Barbados' position as set out in its 14 March 2003 letter stood and it was unable to accede to Digicel Barbados' request for the present. I believe our position, as set out in Mr Austin's letter, to be both legally correct and commercially sensible."
"These allegations were all, in my view, entirely false and, indeed, offensive. I have explained the nature and extent of the involvement of the London office above. No-one in London ever gave me an instruction, written or verbal, as to how I should conduct myself during the interconnection negotiations. In any event, I was (and remain) a qualified legal adviser. I was carrying out my job as legal adviser to the Carrier Services team to the up most of my abilities. I exercised independent judgment to ensure that the advice I gave and the stance we took in negotiations was in accordance with the law."
In my judgment, as before, this reference to legal advice is on the side of the ill-defined line between the contents and the effect of legal advice such that this is not a statement which relies on the contents of the legal advice and does not constitute a waiver of privilege.
"We heard nothing further in response to that letter until 14 May 2003 when Digicel sent a letter. Digicel did not produce a copy of a licence but put forward an explanation of what they said were our obligations. I thought that their delay in replying indicated that they knew they had no right to request interconnection at that time. I responded on 23 May 2003 with our position that we had no obligation to interconnect with someone who was not a licensed carrier which, as set out in that letter, was based on advice."
I have three comments to make in relation to that submission. The first is that fairness is not the touchstone by which it is determined whether there has been a waiver of privilege. I do not regard Mr Justice Elias's decision in the Brennan case as altering that fact. I will refer later to the authority which establishes or restates the proposition on which I rely.
Secondly, although the legal advice would be highly relevant to the fact-finding enquiry into the alleged beliefs and although it is therefore very tempting for the court to require the disclosure of that legal advice, I am only in a position to make an order which compels the defendants to do that which they do not wish to do if I can make such an order in accordance with legal principle. To order disclosure is tempting, but wrong.
Thirdly, in the case much relied upon by Mr Rubin, the Brennan case, Mr Justice Elias stressed that privilege was a very important matter and was not lightly to be overridden by an over-readiness on the part of a court to find a waiver of privilege.
My Conclusion on the Narrow Submission
The Broad Submission
(1) The defendants have pleaded the state of mind of various individuals.
(2) The alleged state of mind relates to matters of law as to whether certain acts or omissions were lawful under various statutes and regulations.
(3) The alleged state of mind is in issue and the court will be asked to make findings as to whether the state of mind existed.
(4) On the evidence in the defendants' witness statements it is, at the lowest, very likely that the defendants did receive legal advice and that that legal advice contributed to the state of mind of the individuals which is pleaded.
(5) It is quite unrealistic to think that the court can fairly make findings of fact as to the alleged state of mind unless the court has available to it all the material which contributed to the individual having the alleged state of mind. That material critically includes any legal advice communicated to that individual.
(6) It is unrealistic to think that the claimants can properly cross-examine the relevant individuals unless the claimants have available to them the same material.
(7) It would be most unfair for the defendants to be allowed to advance their pleaded case as to the alleged state of mind while the claimants and the court are denied access to the legal advice which probably contributed to or caused the individual forming the alleged views, or indeed their actual views if different.
(8) The position as to the fairness of what is proposed means that the court is able to conclude that there has been a waiver of the privilege in the communicated legal advice, whether that was communicated by documents or orally.
(9) Whether the defendants do or do not rely upon the receipt of legal advice does not matter for present purposes.
(10) Any confidentiality in the legal advice has been waived because the defendants have put in issue the state of mind of certain witnesses as to matters of law.
(11) There is no authority which prevents the court holding that there has been a waiver of legal professional privilege and, if necessary, the court should now provide such authority itself.
(1) The documents in question on this application are clearly privileged.
(2) The right to maintain legal professional privilege is a fundamental right of the defendants.
(3) That fundamental right is jealously protected by the relevant legal principles.
(4) The relevant principles do not involve the court in balancing up the desirability of the documents being disclosed and the documents being withheld.
(5) The relevant principles do not turn on what is perceived by the court to be fair in all the circumstances. It is not enough for the claimants to appeal to the court's sense that it would be altogether fairer if the documents were available and were examined at this trial.
(6) To override the defendants' privilege, the claimants must show that something which has been done by the defendants has amounted to a waiver by them of that privilege.
(7) There is clear authority that simply to plead a state of mind which might or might not have been influenced by legal advice which might or might not have been given is not an act of waiver of the privilege.
(8) that authority applies whether the pleaded state of mind is a belief as to fact or a belief as to matters of law.
The Authorities on the Broad Submission
At page 1192, beginning at letter H, Lord Bingham said this:
"If the question were one of balancing the requirements of fairness and justice in the instant proceedings against any legitimate interest a plaintiff might have in maintaining the confidentiality of a confidential relationship, there might be much to be said for the result reached by the judge in the Kershaw case  1 WLR 358 but Reg v Derby Magistrates' Court Ex parte B  AC 487 makes plain that in the context of legal professional privilege no such balance is involved. This authority is important, not only for its clear restatement of principle, but also as illustrating in graphic terms the all but absolute nature of this privilege in the absence of waiver. If ever there was a case in which the interests of justice militated in favour of disclosure, that surely was it."
At page 1193, beginning at letter G, Lord Bingham referred to an earlier decision of Mr Justice Jonathan Parker in Hayes v Dowding  Professional Negligence Law Reports 578. That authority had referred to authority from Australia and the United States and it is clear from Lord Bingham's treatment of the authority that the way in which the law has developed elsewhere is not descriptive of the way in which the law has developed in this jurisdiction. Lord Bingham said this:
"We need not linger on Hayes v Dowding, a case in which the plaintiffs were held to have impliedly waived their right to legal professional privilege by bringing proceedings even though the proceedings were not against any legal adviser. In reaching that conclusion the judge relied heavily on Australian and United States authority. Neither party before us sought to contend that this case was correctly decided and we are satisfied that it was not. The authorities on which the judge principally relied do not represent the law in this country, and the decision must be overruled."
At page 1194A to B, on the subject of fairness, Lord Bingham had this to say:
"Fairness is an important part of the reason why a solicitor who is sued cannot be required to respect the confidentiality of his relationship with the client who is suing him; but, save as between the client and the solicitor he is suing, fairness is not the touchstone by which it is determined whether a client has or has not impliedly waived his privilege."
"The learned judge held that the mere fact that a party's state of mind was in issue in other proceedings did not give rise to an implied waiver of privilege in relation to any legal advice which might have influenced him."
In that case, having described the state of mind which was in issue on the pleadings and the arguments as to waiver of privilege as a result of that being an issue, the learned judge reviewed the authorities, which I need not list. He then referred to statements in the textbooks which were relied upon in that case by the applicant for disclosure. I will refer to one statement in particular, which is in paragraph 32 of Mr Justice Ramsey's judgment, which reads:
"Where in litigation allegations are made by a party concerning his state of mind (eg in entering an agreement) to which legal advice contributed, that party cannot withhold the advice on grounds of privilege but this is because of implied waiver rather than because no privilege attached in the first place."
That statement in the textbook was plainly heavily influenced by the decision in Hayes v Dowding, which itself was heavily influenced by the Australian and United States decisions. Essentially, in his conclusion, Mr Justice Ramsey stated that the statement in the textbook was wrong as a matter of law. Mr Justice Ramsey gave detailed reasons for that conclusion which I need not describe, much less read out. However, I will read paragraphs 53 and 54 of this judgment, where he said the following:
"Rather English law maintains the right of a party to maintain legal privilege. Whilst a person's state of mind and also that person's actions may well have been influenced by legal advice, there is no general implied waiver of privilege material merely because a state of mind or certain actions are in issue. This means that in the absence of disclosure of the privileged legal advice, the other party is precluded from being able to put that legal advice to a person to show that the advice influenced the state of mind or actions of that person. In many cases it could be said that privileged legal advice might be relevant to establishing an issue and that in this way the privileged material could be said to be put in issue.
"That is not the approach taken in English law. Rather the underlying policy considerations for creating privilege to protect communications between a client and solicitor are treated as paramount even if some potential unfairness might occur. The test in English law is therefore based neither on general principles of fairness nor of relevance. Implied waiver arising from particular proceedings or pleading allegations in those proceedings is, in my judgment, limited to proceedings between solicitor and client as set out in Lillicrap v Nalder and Paragon Finance."
Before leaving that authority, my attention was drawn to paragraph 56, where Mr Justice Ramsey said that the case before him was not a case where the claimant had expressly put in issue some legal advice giving rise to an implied waiver. My interpretation of paragraph 5 6 is that the possibility, which did not arise on the facts but which was being referred to by Mr Justice Ramsey, was the possibility of waiver by reason of deployment of the contents of legal advice in the litigation.
My Conclusion on the Broad Submission
The Overall Result