In the transactional context, it is easy to overlook issues of privilege under the Evidence Code in place of salient deal points. It is possible that those who entered into a transactional practice did so to avoid the burdens of the Code and its cousin, the Code of Civil Procedure.
However, when that deal point nobody could agree upon blows up, your client will likely find themselves being asked for emails, Tweets, and everything else related to the transaction. They will also face a deposition on the matter. For this reason, it is crucial that attorneys practicing in the transactional context steer client interactions towards protecting the privilege and the work-product doctrine.
How’s that work again?
Even for experienced litigators, the privilege and the doctrine’s contours can be confusing. It seems easy enough to assume everything touching the attorney-client relationship is privileged. You may even violate your ethical duties by not taking that stance. (You probably remember the rule of “maintaining inviolate [clients’] confidence” from studying for the bar exam.) But what are the privilege and work-product doctrines really?
The client holds the attorney-client privilege (Evid. Code § 953), though an attorney can (and should) invoke the privilege too (Evid. Code § 954). The privilege applies to “information transmitted between a client and his or her lawyer in the course of that relationship and in confidence by a means which, so far as the client is aware, discloses the information to no third persons other than those who are present to further the interest of the client in the consultation or those to whom disclosure is reasonably necessary for the transmission of the information or the accomplishment of the purpose for which the lawyer is consulted, and includes a legal opinion formed and the advice given by the lawyer in the course of that relationship.” (Evid. Code § 952.)
Conversely, the attorney holds the privilege of the attorney work-product doctrine. The doctrine allows attorneys to “prepare cases for trial with that degree of privacy necessary to encourage them to prepare their cases thoroughly and to investigate not only the favorable but the unfavorable aspects of their cases.” (Code of Civ. Proc. § 2018.020.) However, as compared to the Federal Rules of Evidence, the doctrine applies in both the litigation and transactional contexts. (See e.g., County of Los Angeles v. Superior Court (2000) Cal.App.4th 819, 833.)
The doctrine applies more broadly than the privilege, providing absolute protection to “a writing that reflects an attorney’s impressions, conclusions, opinions, or legal research or theories.” (Code. Civ. Proc. § 2018.030.) The doctrine also covers “other” work product, those these may be discoverable if “the court determines that denial of discovery will unfairly prejudice the party seeking discovery in preparing that party's claim or defense or will result in an injustice.” (Id.) However, this breadth of applicability means that courts defined “work-product” on a case-by-case basis. (See Coito v. Superior Court (2012) 54 Cal.4th. 480, 488.)
What does that really mean?
Going back to my opening points, if you are a transactional attorney by choice, that mouthful may have left you half asleep. What practical guidance can the cannon of the privilege and the doctrine offer? How can we avoid the compelled disclosure of emails down the road? A few thoughts:
1. Set expectations and communications habits with your client from the outset.
Client management is a key aspect — if not the primary aspect — of any practice. That management should include discussion on the privilege and the doctrine, setting expectations for how communications will be handled. After all, Law and Order likely has a client or two believing everything under the sun is protected. Emphasize that the privilege applies only to communications, and that the doctrine has limited applicability outside of your formal legal advice. Similarly, set the tone for what should be communicated over the phone or in person rather than in writing.
2. Keep your emails within the representation family.
For many of us, the deeper nuances of deal structure depend on the mysteries of tax law and accounting. There is a reason many of us befriend a CPA or three. Fortunately, both the privilege and the doctrine protect communications between you, the client, and a third party consultant.
In particular, the privilege applies where such communications are “reasonably necessary for the … accomplishment of the purpose for which the lawyer is included.” (Evid. Code [§ 952]; see also Evid. Code § 912, subd. (d).) And under the doctrine, third party communications become protected when met with “an attorney’s impressions, conclusions, opinions, or legal research or theories.” (See Coito v. Superior Court (2012) 54. Cal.4th 480, 485.) The doctrine can also protect a consultant’s notes or other work. (See Rodriguez v. McDonnel Douglas Corp. (1978) 87 Cal.App.3d 626, 647.)
Note though, that limited case law supports the privilege or doctrine’s applicability to communications made exclusively between a third party consultant and the client. (But see Evid. Code § 912, subd. (d).) For this reason, it is best practice to keep yourself in the loop where a consultant is needed on a matter.
3. Limit written communication with the opposing deal side.
As part of setting expectations with your client, you should also emphasize the importance that communications from you not be forwarded or otherwise provided to the opposing deal side. Client waiver of the privilege and the doctrine is all too avoidable a pitfall. On that same note, though, you can also protect the privilege and the doctrine by limiting written communication with opposing deal counsel and parties.