§ 38.08 CLIENTS AND THEIR AGENTS DEFINED

JurisdictionNorth Carolina

§ 38.08. CLIENTS AND THEIR AGENTS DEFINED

The definition of "client" includes governmental bodies and corporations.75 Extending the privilege to governmental entities is supported by the underlying policy of the attorney-client privilege; governmental entities, like individuals, need legal services.76

Corporations. The privilege extends to a firm, partnership, or corporation. There is often a problem in determining whether the attorney represents only the corporation or also the corporate officers (dual representation). "The default assumption is that the attorney only represents the corporate entity, not the individuals within the corporate sphere, and it is the individuals' burden to dispel that presumption."77

A corporation, as a legal fiction, can only communicate through its agents.78 An issue arises when a lower-level employee communicates with the corporation attorney about some corporate-related issue in which the employee was involved — for example, a traffic accident in which the employee drove the corporation's truck. Some courts apply the "control group" test, which covers only communications between the attorney and a corporate agent who possesses the authority to control or act on the legal advice.79 This rule excludes the truckdriver mentioned above because he is not part of the "control group." Only the top echelon of the corporate pyramid can act on behalf of the corporation.

In Upjohn Co. v. United States,80 the Supreme Court rejected the "control group" test as a matter of federal common law.81 With individual clients, the client typically provides the attorney with the relevant information and then the attorney responds with the legal advice. The corporate context differs. The control group, which can act on the advice, does not necessarily have the relevant information.82 The truckdriver has that information in the above example. For this reason, the Court adopted a different test, the critical factors of which include: (1) whether the employee communicated with the attorney in her capacity as corporate counsel, (2) whether both were acting at the behest of their corporate superiors, (3) whether the communication was made to enable the corporation to obtain legal advice and the employee was aware of this, (4) whether the communication concerned matters within the employee's duties, and (5) whether the communications were considered confidential when made.

Numerous other issues arise in the corporate context. For example, does the...

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