Op-Ed: “CJEU rules on the concept of ‘independence of lawyers’” by Javier Ramírez Iglesias
Yesterday, on 4 February 2020, the Grand Chamber of the Court of Justice of the European Union (‘CJEU’), delivered the long-awaited judgment of University of Wrocław and Poland v Research and Development Agency (REA) (Joined Cases C‑515/17 P and C‑561/17 P), where the CJEU deals with who is included in the term a ‘lawyer’authorised to represent a party before the CJEU under the third and fourth paragraphs of Article 19 of the Statute of the Court of Justice of the European Union (‘the Statute’).
This judgment arises from an action brought by the University of Wrocław before the General Court, the University being represented by a lawyer working at a law firm and admitted to practice as a lawyer under Polish law, but who was also connected to the University under a civil law contract (not an employment contract) to teach as an external lecturer.
The General Court declared by Order of 13 June 2017 (T-137/16) that the action filed by the University of Wrocław was manifestly inadmissible under the third and fourth paragraphs of Article 19 of the Statute, and Article 51(1) of the Rules of Procedure of the General Court. In particular, following prior CJEU case law,* the General Court provided that, although he was formally qualified as a lawyer under Polish law, the legal representative of the University of Wrocław failed to satisfy the required condition of ‘independence’ attached to the concept of ‘lawyer’, because there was a risk that the professional opinion of the legal representative might be influenced, at least in part, by his professional environment.
This Order was appealed against before the CJEU by the University of Wrocław and by Poland.
In its judgment yesterday, the CJEU held that the condition of being ‘represented by a lawyer’ under Article 19 of the Statute implies meeting two separate but cumulative conditions: first, to be represented by a lawyer (third paragraph of Article 19); and second, the lawyer must be authorised to practice before a court of a Member State or another State party to the EEA Agreement (fourth paragraph of Article 19).
Whilst the second condition must be interpreted by reference to the national law concerned, the concept of ‘lawyer’ contained in the first condition is an autonomous concept of EU law under which the lawyer is required not only to be a third party (‘represented’) but also to act with ‘independence’, which is specifically understood not as the absence of any connections whatsoever between lawyer and client, but the absence of connections having a manifestly detrimental effect on the lawyer’s capacity to carry out his or her duties.
Moreover, in the REA judgment, the CJEU no longer relies only on the traditional role of the lawyer as a collaborator of the court who is called upon to provide legal assistance ‘in the interest of the sound administration of justice’. Following the Opinion of Advocate General (AG) Bobek, the CJEU now emphasises that, above all, the objective of the task of representation by a lawyer is to protect and defend the interests of the client, acting in full independence and in line with the law and professional ethics rules.
The CJEU concludes that the type of relationship between the University of Wrocław and its lawyer was not sufficient to be regarded as a situation that manifestly undermines his capacity to defend his client’s interest in full independence. Consequently, the CJEU set aside the Order under appeal and referred the case back to the General Court.
The REA judgment and the Opinion of AG Bobek add important new contours to the CJEU’s jurisprudence on the independence of a lawyer.
The concept of ‘independent lawyer’ is relevant not only for the purposes of Article 19 of the Statute but is also key for the issue of legal professional privilege (‘LPP’).
In fact, the CJEU first dealt with the independence concept in order to define the documents that are protected by LPP in competition law investigations carried out by the European Commission. As highlighted by AG Bobek in his Opinion, only later was the concept transferred to support the interpretation of the concept of a ‘lawyer’ for the purposes of the third paragraph of Article 19 of the Statute.
In particular, in the AM&S (155/79, paragraph 21) and AKZO Nobel cases (C-550/07 P, paragraph 41, and T-125/03 and T-253/03, paragraph 117), the CJEU provided that two cumulative conditions must be met for the protection of legal communications under LPP: first, the communications must ‘be made for the purposes and in the interests of the “client’s rights of defence”’ and, second, the exchange must emanate from ‘independent lawyers’. And then the CJEU distinguished between factors that are positive (professional ethics obligations) and negative (the absence of an employment relationship) to define such independence, excluding the application of LPP to legal communications involving in-house lawyers (with some exceptions – see Hilti Aktiengesellschaft v Commission (T-30/89, paragraphs 13 to 17)) even if they are members of the national bar.
In its REA judgment, the CJEU makes a similar reference to negative and positive factors that determine the concept of independence, and subsequently enumerates several situations previously addressed by the CJEU where lawyer independence was compromised. These include when the lawyer is vested with extensive administrative and financial powers that place him or her at a high executive level within the represented organisation; when holding a high-level management position within such legal entity; or when holding shares and chairing the board of administration of the company represented.
Under the new definition of independence, ‘to be understood not as the lack of any connections whatsoever between the lawyer and his or her client, but the lack of connections which have a manifestly detrimental effect on his or her capacity to carry out the task of defending his or her client while acting in that client’s interest to the greatest possible extent’, the classic dichotomy between external vs. in-house lawyer for the purposes of potentially triggering LPP protection may no longer be deemed valid, but the general requirement of independence is to be examined on a case-by-case basis to determine whether the concerned lawyer is deemed to be independent or not.
In this context, AG Bobek provided a number of correct observations when questioning which underlying principles serve to differentiate the relationship between an in-house lawyer and his employer from the relationship between an external lawyer and his (potential sole or main) client, and whether lawyers employed by a corporation that gives them full freedom in terms of how they advise should be deemed ‘independent lawyers’.
Thus, on the one hand, even the communications with an external lawyer ‘made for the purposes and in the interests of the “client’s rights of defence”’ could be eventually excluded from LPP protection if the concerned lawyer is deemed not to be an ‘independent lawyer’. On the other hand, the conditions under which an in-house lawyer (admitted to the national bar) performs his or her work would be relevant to determine whether he or she is an ‘independent lawyer’. Therefore, the mere existence of an employment relationship should not be sufficient to automatically exclude an in-house lawyer from the definition of an ‘independent lawyer’ such that his or her legal communications are ineligible for LPP protection.
Unfortunately, a concept of a lawyer’s independence that requires a case-by-case assessment creates unwelcome legal uncertainty. This could be prevented by approving secondary legislation at the EU level to deal with LPP for external and in-house lawyers in order to guarantee such independence and protect legal communications against unauthorised disclosure.
Such a regulatory approach would be consistent with the evolution of the law of the EU, which now recognises in its secondary legislation that professional independence can exist even in situations where the concerned professional is bound by a relationship of employment, and that the performance of other additional duties by a professional for his employer is not deemed to affect his ability to exercise professional independence or disregard the application of professional secrecy to his or her communications.
This is the case for instance under the General Data Protection Regulation,** which foresees that data protection officers: (i) should be in a position to perform their duties and tasks in an independent manner notwithstanding being bound by an employment relationship; (ii) may perform additional unrelated duties for their employers, provided that such duties do not result in a conflict of interests; and (iii) be eligible and subject to professional secrecy ‘in accordance with Union or Member State law’ concerning the performance of their specific tasks as data protection officer.
Moreover, such an approach would also be consistent with the evolution of the laws of the EU Member States within the last decade, where now more Member States recognise LPP for in-house lawyers than when the CJEU ruled in the AKZO case in 2010.***
Javier Ramírez Iglesias is a member of the Board of Directors and Chair of Advocacy of ACC Europe, the European chapter of the Association of Corporate Counsel, the leading global association of in-house lawyers. He has been admitted to the Madrid Lawyers Bar since 1992 and practices law as an in-house lawyer at HP Inc. He lectures at IE Law School – where in the last academic year he was recognised with the top Excellence in Teaching Award for Executive Education – and at the University Carlos III (Master in European Union Law).
*See for instance the CJEU’s ruling of 6 September 2012 in PUKE (Prezes Urzędu Komunikacji Elektronicznej) v European Commission, C-422/11 P and C-423/11. In the same sense, see also the more recent Order of the General Court of 30 May 2018 in PJ v EUIPO (T-664/16).
**See Recital 97 as well as Articles 37.6, 38.5 and 38.6 of General Data Protection Regulation 2016/679.
**In fact, nowadays LPP is recognised – at least to a certain extent – for both in-house and external lawyers who are members of the national bar in half of the States party to the EEA Agreement (namely in Belgium, Cyprus, Finland, Germany, Greece, Hungary, Ireland, Iceland, Latvia, Malta, the Netherlands, Norway, Poland, Portugal and Spain), and in the United Kingdom (subject to an EEA Agreement transition regime until at least 31 December 2020).