Crane v. Crane

TERRY, Associate Judge,

concurring:

I join without reservation in the opinion of the court, but I think it should go a little further. From the present record, it does not appear that the trial court had sufficient information before it to rule definitively on the husband’s claim of privilege or, specifically, the applicability of the crime-fraud exception to the privilege. Since this matter will undoubtedly come before the trial court again, I offer a few general observations in the hope of expediting future proceedings in this case, which has already consumed a great deal of judicial time and effort.

To be protected by the attorney-client privilege, communications between a lawyer and a client must concern legal advice; business advice or similar assistance is not privileged. “Generally, an attorney who serves as a business agent to a client may not assert the attorney-client privilege, because no confidential relationship attaches.” United States v. Huberts, 637 F.2d 630, 640 (9th Cir.1980), cert. denied, 451 U.S. 975 , 101 S.Ct. 2058 , 68 L.Ed.2d 356 (1981). If an attorney merely transfers assets for a client or provides other ministerial services, those transfers or other activities are not protected by the privilege. Thus, in United States v. Davis, 636 F.2d 1028 , 1033 n. 3 (5th Cir.), cert. denied, 454 U.S. 862 , 102 S.Ct. 320 , 70 L.Ed.2d 162 (1981), the court held that documents “pertaining to the establishment and maintenance or other transactions with any trust fund, [including] establishment and maintenance of the trust,” were not shielded from disclosure by the attorney-client privilege. *941 The court reasoned that such documents did not fall within the definition of “legal advice”: “[documents establishing trust funds ... are not privileged because in their creation the attorney acts merely as a scrivener.” Id. at 1044 n. 19.

Davis and the other cases distinguishing business dealings from legal advice at least suggest that any communication between the husband and Mr. Bruce concerning the establishment of a trust on the Isle of Man may not be privileged. At the outset, therefore, the trial court must determine whether Mr. Bruce was merely assisting the husband in the conduct of his business affairs or whether he was providing legal advice. If the communications between them simply pertained to the establishment of a trust, Mr. Bruce may well have been acting “merely as a scrivener,” so that the privilege would not apply.

On the other hand, if the husband consulted Mr. Bruce for his opinion on whether the establishment of such a trust would violate the trial court’s injunction, he was soliciting legal advice. Even then, however, the communications at issue may be disclosable under the so-called crime-fraud exception to the privilege. Under that exception, the privilege “does not extend to communications ‘made for the purpose of getting advice for the commission of a fraud’ or crime.” United States v. Zolin, 491 U.S. 554, 563 , 109 S.Ct. 2619, 2626 , 105 L.Ed.2d 469 (1989) (citation omitted).

Nevertheless, before the crime-fraud exception may be invoked, the party seeking its application “must first make a prima facie showing of a violation sufficiently serious to defeat the privilege.” In re Sealed Case, 244 U.S.App.D.C. 11, 15 , 754 F.2d 395, 399 (1985) (footnote omitted); see Clark v. United States, 289 U.S. 1, 15 , 53 S.Ct. 465, 469 , 77 L.Ed. 993 (1933) (“To drive the privilege away, there must be ‘something to give colour to the charge;’ there must be ‘prima facie evidence that it has some foundation in fact’ ” (citation omitted)). This prima facie showing of crime or fraud need not rise to the level of dispositive proof, but it must have at least some substance. “To invoke the ‘crime-fraud’ exception to the privilege, it is not necessary to prove beyond a reasonable doubt that the attorney or client [was] attempting or did commit a crime or fraud. However, more is necessary than mere allegations of wrongdoing....” Coleman v. American Broadcasting Cos., 106 F.R.D. 201, 207 (D.D.C.1985).

Before the trial court can find that the crime-fraud exception applies in the instant case, the wife must make a prima facie showing of crime or fraud. If this case were properly before us on the merits, I would hold that the court erred in assuming the existence of the Manx trust, as it did in its December 3 order (in Conclusion of Law No. 3). The court cannot simply accept the wife’s allegations and assume the existence of the alleged trust; the law requires at least a prima facie showing that it does exist and that it was established for an improper purpose.

If the wife cannot make the necessary showing without the subpoenaed documents, the court may — either sua sponte or on the wife’s motion — conduct an in camera examination of any documents pertaining to the alleged Manx trust. Other trial courts have followed this course, and have found in the subpoenaed documents themselves prima facie evidence of a crime or fraud. See In re Sealed Case, 219 U.S.App.D.C. 195, 217 , 676 F.2d 793, 815 (1982) (“In appropriate cases the subpoenaed material itself may provide prima facie evidence of a violation” (footnote omitted)). Before the court may take that step, however, the wife “must present evidence sufficient to support a reasonable belief that in camera review may yield evidence that establishes the [crime-fraud] exception’s applicability_ [That] threshold showing ... may be met by using any relevant evidence, lawfully obtained, that has not been adjudicated to be privileged.” United States v. Zolin, supra, 491 U.S. at 574-575 , 109 S.Ct. at 2632 . 1 If such a *942 showing is made, the court may require the husband or Mr. Bruce to make the documents available for in camera inspection, a practice expressly approved by the Supreme Court in Zolin and “well established in the federal courts.” Id. at 568-569 , 109 S.Ct. at 2628-2629 . But if such a showing is not made, the crime-fraud exception to the privilege will probably be inapplicable.

. Elsewhere in its opinion, the Supreme Court made clear that the "threshold" was fairly low:

We therefore conclude that a lesser evidentia-ry showing is needed to trigger in camera *942 review than is required ultimately to overcome the privilege.... The threshold we set, in other words, need not be a stringent one.

We think that the following standard strikes the correct balance. Before engaging in in camera review to determine the applicability of the crime-fraud exception, "the judge should require a showing of a factual basis adequate to support a good faith belief by a reasonable person" ... that in camera review of the materials may reveal evidence to establish the claim that the crime-fraud exception applies.

United States v. Zolin, supra, 491 U.S. at 572 , 109 S.Ct. at 2631 (citations omitted).