The subject of e-mails, letters, and conversations between an attorney
and their client are protected under attorney-client privilege. This privilege
prevents third-parties from compelling attorneys from disclosing client
communications to them. However, how does this privilege function when
a business with multiple officers and employees is the client of an attorney?
This article examines the nature and extent of attorney-client privilege
California Law on Attorney-Business Client Privilege
The rules involving attorney-client privilege in California are recognized
explicitly by statute under California Evidence Code § 950
et seq. The evidence code and related case law interpreting its provisions broadly
define attorney-client privilege to protect all communications between
a person and their attorney regarding their legal concerns.
In addition to the California Evidence Code, all attorneys owe a duty of
confidentiality to their clients. As a result, lawyers are ethically bound
not to disclose privileged information without the client’s authorization.
Attorneys can face disciplinary action for violating their duty of confidentiality.
However, clients can waive privilege by communicating what would otherwise
qualify as privileged information to third-parties. Thus, a client can
inadvertently break privilege if their communications to the attorney
are conducted in the presence of a third party.
Significantly, communications that are made for the purpose of perpetrating
a crime are not protected by attorney-client privilege.
Who Qualifies as a “Client?”
In situations where an attorney represents a business entity such as a
corporation, partnership, or LLC, determining to whom an attorney owes
a duty of confidentiality can be tricky. Under California Evidence Code
§ 951, “client” is broadly defined as someone who “consults
a lawyer for the purpose of retaining the lawyer or securing legal service
or advice from him in his professional capacity.”
When an attorney represents a business entity, the business itself is the
client. This includes officers and employees. However, when an employee,
officer, or partner’s legal interests are adverse to that of the
business as a whole, a conflict of interest can arise.
Under California law, employee communications are protected under attorney-client
privileged under the following circumstances:
- Communications are made for securing legal advice;
- The employee is communicating with the attorney at the behest of their superior;
- The superior directs the employee to communicate with the attorney in order
to secure legal advice;
- The subject matter of the communications falls under the scope of the employee’s
- The communication does not extend beyond those who need to know its contents.
Significantly, corporations do not enjoy a constitutional privilege against
self-incrimination. Thus, individual employees who are concerned about
criminal liability should retain independent counsel with regard to that
issue. However, corporate employees cannot be compelled to give self-incriminating
testimony. This might include producing business records and documents.
Employees can be forced to provide oral testimony regarding the identification
of nonprivileged documents that is the subject of a subpoena.
Call Allen, Semelsberger & Kaelin, LLP for Experienced Legal Advice
Allen, Semelsberger & Kaelin, LLP, we have the necessary experience and knowledge to ensure your business’
interests and rights are adequately protected. We can handle transactional
matters such as business formation, incorporation, and document preparation
and review. We can also advise on matters of business litigation.
To schedule a free consultation with one of our experienced business lawyers,
call Allen, Semelsberger & Kaelin, LLP at (888) 998-2031 or
contact us online today.