Risk Management Tip: Keep Invoices Bland

By Jennifer A. Becker Long & Levit

For generations California attorneys have understood the attorney-client privilege is an absolute shield against discovery. Case after case has broadly interpreted and reinforced the strength of the privilege.

Three cases in 2016 demonstrated the continued force of this shield. In Suarez v. Trigg Laboratories (2016) 3 Cal.App.5th 118 one party in a contract dispute hid information about the ongoing sale of his business from his opponent by having his broker transmit offers to his attorney. The Second District held the party was within his rights in doing so. In DP Pham, LLC v. Cheadle (2016) 246 Cal.App.4th 653, the Fourth District held a court may not conduct an in camera review of attorney-client communications once the holder of the privilege makes a prima facie showing of privilege. Ardon v. City of Los Angeles (2016) 62 Cal.4th 1176 held inadvertent disclosure of attorney-client privileged and work product protected documents under a Public Records Act (PRA) request does not constitute waiver, and the claw back rules of inadvertently disclosed documents applies.

But late in the year, the Supreme Court decided Los Angeles County Board of Supervisors v. Superior Court (ACLU of Southern California) (2016) 2 Cal.5th 282. The court, in a four to three decision, held whether an attorney client communication is privileged depends on whether the communication bears some relationship to the attorney’s legal services. All attorney-client communications are exchanged privately, but that alone does not render them privileged. An invoice listing amounts of fees is not communicated for legal consultation. The inquiry turns on the link between the content and the purpose of the privilege. A privileged communication must occur in the attorney-client relationship and be made for the legal consultation, not an unrelated or ancillary purpose. Invoices, transmitted to allow an attorney to collect a fee, may contain unprivileged information. This opens the door for potential disclosures under the State’s Public Records Act after the litigation ends when nothing in the invoice could reflect ongoing litigation strategy.

The dissent characterized the majority as adding a consideration of a communication’s purpose as an additional, non-statutory element to the legislature’s definition of a “confidential communication,” a departure unsupported in law. The dissenting opinion warned attorneys must now counsel their clients that confidential communications between lawyer and client may be forced into the open by interested parties once the litigation has concluded.

The majority could have limited the analysis to public agencies subject to the PRA, but set forth a general rule defining a privileged communication as one pertaining to the purpose of the representation. The opinion does not reflect the reality of modern practice, where clients often demand specificity in invoices to evaluate the reasonableness of fees. It is premature to opine how this opinion will affect protection of the relationship going forward. Meanwhile, clients demanding detailed invoices should understand their content could be vulnerable to disclosure.

Jennifer Becker is certified by the State Bar of California, Board of Legal Specialization in Legal Malpractice, and is chair of BASF’s Legal Malpractice Section.  She is a partner at Long & Levit, and the Editor-in-Chief of Long & Levit’s Lawyers and Judge’s Blog, www.longlevit.com/blog/, which is searchable by topic and case name.