As the privilege belongs to the client and not the lawyer, copies of attorney-client communications possessed by the client are protected, so long as the communications were intended to be made in confidence, they were sought in the course of the client's attorney providing legal advice, and the advice was based on the attorney's expertise. The copy will be protected so long as the client has not previously waived their privilege.

As set out in S&K Processors Ltd. v. Campbell Avenue Herring Producers Ltd., waiver of privilege is normally established where it is shown that the client both:

• Knows of the privilege attached to the communications
• Voluntarily makes clear an intention to waive that privilege

In the event that privileged communications have been inadvertently released, a court will engage in an objective test to discern whether the client's conduct demonstrates an intention to waive privilege (e.g., the client participated or gave instructions specific to actions that led to the release of the privileged communications).

Solicitor-client privilege applies to communications with internal and external counsel. The difficult question arises when work done by in-house counsel straddles the line between business and legal advice; privilege will generally apply to the latter, but not the former. As set out by the Supreme Court of Canada in Pritchard v. Ontario, legal advice from in-house counsel may be subject to increased scrutiny:

"Owing to the nature of the work of in-house counsel, often having both legal and nonlegal responsibilities, each situation must be assessed on a case-by-case basis to determine if the circumstances were such that the privilege arose"… "[However,] [i]f an in-house lawyer is conveying advice that would be characterized as privileged, the fact that he or she is 'in-house' does not remove the privilege, or change its nature."

While in-house counsel may be subject to increased scrutiny, so long as the communications between the in-house lawyers meet the aforementioned test for privilege (i.e., the communications involved legal advice and not business advice, and the communications concern the in-house counsel's function as a lawyer), the privilege will extend to the communications.

The modern view in Canada is that solicitor-client communications are protected by privilege even where the solicitor providing the advice is not qualified to practice in the jurisdiction in which the advice was given. As set out by the Manitoba Court of Appeal in Gower v. Tolko Manitoba Inc.:

"So long as one of the parties to the communication is a lawyer, though perhaps not called to the bar of the jurisdiction in which the issue arises, [solicitor-client] privilege attaches. To hold otherwise would be to ignore the realities of the modern practice of law."

Privilege may extend, in the right circumstances, to third parties who are performing functions that are central to the existence or operation of the lawyer-client relationship. These could include accountants or tax consultants advising on tax law, so long as they are performing their specialized duties in their areas of expertise, and are included in group communications and receive legal advice from legal counsel. The scope of this "deal team" privilege will depend on the facts of each case and is discussed in greater detail below.

However, attorney-client privilege will not extend to communications of nonlawyers in the provision of advice on legal issues related to their field if this advice falls outside of any existing attorney-client relationship.

In Canada (National Revenue) v. Atlas Tube Canada ULC, the Federal Court ruled that the Canada Revenue Agency (CRA) could compel a private corporation to disclose a tax due diligence report in the course of an audit. In its analysis, the court determined that the dominant purpose of the report was to inform a business decision and the effect of the report on informing legal advice was ancillary to the business decision. Further, the court found that the contents of the report were accounting opinions, not prepared for the purpose of obtaining legal advice on the structuring of the transaction. Therefore, the report was not protected by solicitor-client privilege.

Canadian courts have also recognized patent agent privilege. In a recent case, the Federal Court ruled that patent agent privilege does not include all communications involving patent strategy, patentability or infringement. To be privileged, the communication must relate to the protection of an invention.