Has the exception outgrown the privilege?: Exploring the application of the crime-fraud exception to the attorney-client privilege

Georgetown Journal of Legal Ethics, The, Summer 2003 by Daily, Auburn K, Thornquist, S Britta

INTRODUCTION

The attorney-client privilege is one of the oldest and most revered aspects of the American judicial system.1 However, "the attorney-client privilege is a fragile one which will not be available unless all of the elements of the privilege are present."2 Among the oft-cited justifications for the privilege, a few key concepts emerge:

[CJompetent legal advice requires a complete understanding of the circumstances surrounding a client's needs and such an understanding may only be gained by encouraging complete disclosure within the attorney-client relationship; if a client fears subsequent disclosure of communicated information in a court of law, then full disclosure is unlikely; and, fully informed advice, or advocacy in our adversarial system, promotes the administration of justice.3

However, with an understanding of the value inherent in the attorney-client privilege, is a commensurate understanding that this privilege, with the costs it imposes on the judicial system, cannot be absolute.4 The privilege, though necessary to allow attorneys to simultaneously fulfill their ethical duties of zealous advocacy and client confidentiality, has the "effect of withholding relevant information from the factfinder" and should therefore be applied "only where necessary to achieve its purpose."5

The troublesome question of how to balance the attorney's obligations of loyalty to his client with the need to protect society from a client's unlawful conduct is not a new one.6 The modern day answer to that question, which lies in the crime-fraud exception to the attorney-client privilege, has its roots in 18th century English common law.7 In Annelsey v. Earl ofAnglesea, counsel opposing the attorney-client privilege argued that a public moral obligation to disclose information should supersede the privilege when that attorney had been retained for an unlawful purpose.8 Subsequently, the crime-fraud exception was given shape in Regina v. Cox in which the court justified the refusal to protect communications which aided in the furtherance of a crime or fraud by saying the conditions necessary to establish an attorney-client relationship and the conditions of deceit and illegality could not coexist contemporaneously.9 Additionally, the court adopted a case -by-case approach to determining the applicability of the crime fraud exception, rather than a bright-line rule regarding the evidentiary standard and application of the crime-fraud exception.10 Courts continue to attempt to strike a balance between the need to protect client confidentiality and the need to provide the judge and jury with full access to relevant information.11 The generally accepted formulation of the crime-fraud exception states that the privilege must be enforced to protect confidential information; however, the privilege should not extend to communications "made for the purpose of getting advice for the commission of a fraud or crime."12 Accordingly, "the exception applies whether the client discloses an evil intention to the attorney[,] . . . conceals such intention[,] . . . or forms such intention only after obtaining legal counsel."13

Currently, although the use and the underlying justifications of the crime-fraud exception are well settled, uncertainties surrounding the requirements for invoking the crime-fraud exception to the attorney-client privilege continue to plague courts at every level, and in every state.14 Specifically, courts are grappling with three main issues: the "quantum of evidence needed to overcome the presumption in favor of the confidentiality of attorney-client communications;" whether the communication itself can meet this evidentiary burden; and, "if so, should the determination be made by the judge after an in camera examination of the communication."15 Furthermore, some courts are expanding both the scope of the crime-fraud exception and the ease with which it can be asserted, thereby making the exception vulnerable to abuse with potentially negative consequences for attorneys and (prospective) clients everywhere.16 This article will look at the potential overuse of the crime-fraud exception that threatens to cut away at the protection of the attorney-client privilege. Part I will explore the process by which a party may assert the crime-fraud exception to uncover otherwise privileged information. Part II will focus on the aspects of this process that are most vulnerable to abuse. Part III will then look at how courts and critics are responding to these problems and will suggest possible ways for courts to address and prevent abuse of the crime fraud exception.

I. THE PROCESS FOR ASSERTING THE CRIME-FRAUD EXCEPTION

The attorney-client privilege "encourage[s] full and frank communications between attorneys and their clients" by making uch communications confidential.17 The privilege does not, however, protect communications made in furtherance of a crime or fraud because "the costs to truth-seeking outweigh the justice-enhancing effects of a complete and candid attorney-client conversation."18 Determining whether the exception applies depends not on the occurrence of a crime or fraud, but rather on the client's intent at the time he sought the attorney's advice.19 The exception applies if the client intended to consult with a lawyer in furtherance of an intended crime or fraud.20 Demonstrating the requisite criminal intent may be highly problematic.21 It is difficult, if not impossible, for attorneys or the courts to objectively determine what the client's intent was in seeking legal advice.22