City of Davenport v. Office of Auditor of State of Iowa - Attorney-Client Privilege in Government Audits

The Iowa Supreme Court addressed whether the Office of Auditor of State has statutory authority under Iowa Code section 11.41(3) to access attorney-client privileged materials during an audit of the City of Davenport. The Court reviewed the City's interlocutory appeal challenging district court orders that permitted the Auditor to conduct an in camera review of potentially privileged documents and ruled that such access may be authorized by statute.

For government entities subject to state audit requirements, this ruling clarifies that attorney-client privilege may yield to statutory audit authority under certain conditions. Municipalities and other government agencies in Iowa should review their document retention and privilege practices, ensuring that communications intended to remain confidential are clearly marked and that legal counsel advises on privilege protections in the context of mandatory audit compliance. Legal professionals advising government clients should consider the implications for maintaining privilege when client entities are subject to state audit oversight.