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The first type, legal advice privilege, ensures that communications between lawyers and their client for the dominant purpose of giving or obtaining legal advice are protected from disclosure. This privilege seeks to encourage frank and candid communications between lawyers and their client. In common law jurisdictions, this privilege is absolute and is not easily waived, reflecting the premium placed on the lawyer-client relationship.

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Legal advice privilege applies not only to external lawyers but in-house counsel as well, as long as they are acting in a legal rather than an executive capacity. The privilege also extends to non-legally qualified personnel (eg, trainees or paralegals) acting under the supervision of a lawyer.

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The second type, litigation privilege, extends to documents created when there is a reasonable prospect of litigation, arbitration or other forms of adversarial proceedings. The prospect of adversarial proceedings must be more than a mere possibility, although it need not necessarily be greater than 50%. Unlike legal advice privilege, litigation privilege is not limited to documents exchanged between lawyers and their client; it extends also to documents created by other parties (for example, technical experts, other professional advisors) as long as the document was created for the dominant purpose of the contemplated adversarial proceedings.

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The third type, 'without prejudice' privilege, renders inadmissible any communications between the parties made in a genuine attempt to settle the dispute. This rule seeks to facilitate settlement by encouraging parties to communicate settlement offers freely without fear that such offers may be disclosed to a court or tribunal in the event that settlement negotiations fail. Although it is common to see correspondence exchanged during settlement discussions being marked 'without prejudice', such marking is not conclusive of its existence, and the privilege applies to correspondence even if not marked as such.

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The third type, 'without prejudice' privilege, renders inadmissible any communications between the parties made in a genuine attempt to settle the dispute. This rule seeks to facilitate settlement by encouraging parties to communicate settlement offers freely without fear that such offers may be disclosed to a court or tribunal in the event that settlement negotiations fail. Although it is common to see correspondence exchanged during settlement discussions being marked 'without prejudice', such marking is not conclusive of its existence, and the privilege applies to correspondence even if not marked as such.

The second type, litigation privilege, extends to documents created when there is a reasonable prospect of litigation, arbitration or other forms of adversarial proceedings. The prospect of adversarial proceedings must be more than a mere possibility, although it need not necessarily be greater than 50%. Unlike legal advice privilege, litigation privilege is not limited to documents exchanged between lawyers and their client; it extends also to documents created by other parties (for example, technical experts, other professional advisors) as long as the document was created for the dominant purpose of the contemplated adversarial proceedings.

The first type, legal advice privilege, ensures that communications between lawyers and their client for the dominant purpose of giving or obtaining legal advice are protected from disclosure. This privilege seeks to encourage frank and candid communications between lawyers and their client. In common law jurisdictions, this privilege is absolute and is not easily waived, reflecting the premium placed on the lawyer-client relationship.