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Legal professional privilege clarified for multidisciplinary partnerships

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It is not unusual for professional service firms to have divisions of advisers across various disciplines, such as a accountants and lawyers.  Can legal professional privilege be used as a shield by these firms to prevent the disclosure of documents?  In Commissioner of Taxation v PricewaterhouseCoopers [2022] FCA 278, the Federal Court of Australia has found that PricewaterhouseCoopers Australia (PwC Australia) was not entitled to claim legal professional privilege over various documents sought in a notice to produce served by the Commissioner of Taxation.


During an audit of an Australian company, the Commissioner issued notices to produce documents on PwC Australia.  In response, PwC Australia claimed legal professional privilege over approximately 45,000 documents.  The Commissioner disputed PwC Australia’s claims of privilege over 15,500 documents.

The Lawyer-Client Relationship Issue for PwC’s Privilege Claims

The common law doctrine of legal professional privilege protects from disclosure confidential communications between a lawyer and client made for the “dominant purpose” of giving or obtaining legal advice, or the provision of legal services.  In these proceedings, Moshinsky J determined whether the documents which PwC Australia claimed were subject to privilege satisfied the “dominant purpose” test by reference to a sample of documents.

Unlike a traditional law firm, PwC Australia is a multi-disciplinary partnership that provides both legal and non-legal services.  At issue was the extent of PwC Australia’s legal relationship with its clients.  The services referred to in the documents were provided by PwC Australia to its clients, referred to as the JBS Parties, pursuant to an Umbrella Engagement Agreement and nine Statements of Work.  Critically, the services were provided by a team of lawyers and non-lawyers.

The Federal Court of Australia’s Decision

His Honour addressed three grounds of objection to the privilege claims from the Commissioner.

Form of Engagements

First, the Commissioner argued that the form of the engagements between PwC Australia and the JBS Australia Group, reflected in the Statements of Work, did not establish a relationship of lawyer and client.  If this was the case, then there can be no claim for legal professional privilege.

This was because the Commissioner argued the involvement of Non-Legal Practitioners (NLPs) in assisting lawyers with providing legal services to the client, or acting as agents of the client when communicating with lawyers, undermined any lawyer-client relationship.

In rejecting this ground, his Honour found the Statements of Work did establish a relationship of lawyer and client sufficient to ground a privilege claim, given each Statement of Work identified the client, the lawyers to provide the services, the NLPs to assist the lawyers in the provision of those services, and the services to be provided as legal services.

No Lawyer-Client Relationship as a “Matter of Substance”

The Commissioner also argued that in substance the services provided by PwC Australia pursuant to the engagements did not reflect a lawyer-client relationship.  Rather, PwC Australia was engaged as a multi-disciplinary adviser with a group of tax advisers to provide multifaceted advice.

His Honour declined to make a finding on this ground because it was framed as a general proposition in relation to all work done for the JBS Parties.  Rather, the test for privilege requires considering the status of each individual document.

Do the Sample Documents satisfy the dominant purpose test?

The Commissioner also argued the documents in dispute did not satisfy the “dominant purpose” test.  To address this ground, Moshinsky J completed a detailed analysis of the 116 sample documents and found the majority did not record communications for the dominant purpose of giving or obtaining legal advice from lawyers of PwC Australia.  Therefore, those documents were not protected by privilege.

In performing this exercise, Moshinsky J categorised the documents by reference to their content, context, and relevant evidence.  A “critical part of the context” was the provision of legal and non-legal services by PwC.  Additionally, his Honour found documents did not attract privilege where non-legal advice appeared to have been “routed” through the lawyers with the intention of obtaining the protection of legal professional privilege.

Key Takeaways

Knowing when legal professional privilege can be claimed over a document is important for lawyers and clients.  In light of the Federal Court’s decision, consider the following factors:

  • Is the person sending or receiving the communication doing so in their legal capacity?
  • Documents provided to lawyers merely to attract the protection of the privilege and not for the dominant purpose of providing legal advice will not be protected by privilege.
  • Where there are multiple purposes for the making of the communication, the Court will consider how much weight to give to the non-legal purpose as against the legal purposes.


Luke Dominish​
Kaitlyn Oliver
Law Graduate

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