Privilege Protects General Counsel’s Communications with Third-Party Agents

A Florida appellate court applied the corporate attorney–client privilege to protect communications between a condominium association’s general counsel and employees of the association’s property-management company.  The court overruled the trial court’s determination that counsel waived the privilege because the recipients were not the association’s “employees.”  Las Olas River House Ass’n, Inc. v. Lorh, LLC, 2015 WL 8347977 (Fla. Dist. Ct. App. Dec. 9, 2015).  You may read the decision here.

The Communications

A condominium association had a management contract with a property-management company.  The association’s general counsel had multiple email communications with two employees of the property-management company (not the association) about the plaintiffs—who were corporate owners of two commercial condo units.

The plaintiffs sought these communications, and argued that the counsel waived the attorney–client privilege because the email recipients were third parties.  The trial court agreed and, without conducting an in camera inspection, ordered the documents produced.

Corporate Attorney–Client Privilege

Florida’s Evidence Code contains its attorney–client privilege, and provides that a party waives the privilege upon disclosure to third parties except those who are “reasonably necessary for the transmission of the communication.”  Fla. Stat. § 90.502.  Courts interpret this exception to include privileged communications involving a client’s agents.  Gerheiser v. Stephens, 712 So. 2d 1252 (Fla. Dist. Ct. App. 1998).

The Florida Supreme Court employs a five-part test for determining whether the attorney–client privilege protects a company’s communications.  The company must show (1) the individuals would not have communicated but for the contemplation of legal services; (2) the employee making the communication did so at the direction of a supervisor; (3) the superior made the request as part of the company’s effort to secure legal advice; (4) the communication relates to a subject matter within the scope of the employee’s duties; and (5) the company does not disseminate the communication beyond those who need to know its contents.  Southern Bell Tel. & Tel. Co. v. Deason, 632 So. 2d 1377 (Fla. 1994).

Ruling: In Camera Inspection Required?

Because the privilege, particularly in the corporate setting, protects communications flowing through agents, not just employees, the appellate court rejected the trial court’s blanket refusal to apply the privilege to the general counsel’s communications with the property manager’s employees.

Instead, the court remanded the case to the trial court, and ordered it to conduct an in camera inspection of the communications using Deason’s subject-matter corporate attorney–client privilege test.

POP Analysis

The trial court should not have automatically rejected the privilege claims simply because the recipients were not corporate employees.  The company argued that the recipients were non-employee agents that fell within the Deason standard, and the court should have focused its analysis on that claim.

But should the appellate court have automatically required an in camera inspection?  Why can the trial court not analyze the agent question based on affidavits or other sworn testimony?  This remains a developing area, other courts apply a discretionary standard when considering in camera inspections, as I highlighted in this post.