UK Supreme Court refuses to extend privilege to accountants

The Supreme Court confirmed today that legal advice privilege (“LAP”) cannot be claimed in respect of confidential communications between accountants and their clients for the purpose of requesting or providing legal advice. LAP can be claimed only where such communications are between qualified solicitors, barristers or foreign lawyers (including in-house lawyers) and their clients: R (on the application of Prudential plc and another) v Special Commissioner of Income Tax and another [2013] UKSC 1.

Herbert Smith Freehills partners Heather Gething and Julian Copeman, assisted by Andrew Cooke, advised the Law Society of England and Wales on its successful intervention in the appeal. The Law Society was represented by Sir Sydney Kentridge QC, Tom Adam QC and Tim Johnston of Brick Court Chambers. The Bar Council, the Institute of Chartered Accountants in England and Wales (“ICAEW”), the Association Internationale pour la Protection de la Propriété Intellectuelle UK and the Legal Services Board also intervened.

By a majority of five to two, the Supreme Court confirmed the current position that LAP is confined to confidential legal advice provided by professional, qualified lawyers. The Supreme Court therefore accepted the Law Society’s position that LAP should not be extended beyond its current scope at common law and that any such extension was a matter for Parliament. Continue reading

Supreme Court hearing in Prudential starts today

The Supreme Court is set to hear Prudential’s appeal against the Court of Appeal’s much-publicised decision from October 2010 which confirmed that legal professional privilege did not extend to advice on tax law given by accountants, or anyone other than members of the legal professions (ie qualified solicitors, barristers or foreign lawyers): R (on the application of Prudential PLC & Anor) v Special Commissioner of Income Tax & Anor [2010] EWCA Civ 1094 (see post).

The appeal has been listed for a hearing of three days before a panel of (unusually) seven Justices of the Supreme Court, which reflects the great public importance of the appeal. Its importance is also highlighted by the fact that various bodies including the Law Society (represented by Herbert Smith Freehills), the Bar Council, the Legal Services Board and the Institute of Chartered Accountants in England and Wales are intervening in the appeal.

For those who are keen, the proceedings can be followed from 10.30 am on “Supreme Court TV”, which allows Supreme Court hearings to be viewed live over the internet.

Prudential appeal to be heard in November 2012

In April this year, Prudential was granted permission to appeal to the Supreme Court against the Court of Appeal’s decision confirming that legal professional privilege is restricted, at common law, to members of the legal professions: R (on the application of Prudential PLC & Anor) v Special Commissioner of Income Tax & Anor [2010] EWCA Civ 1094. (See here on the Supreme Court’s grant of permission.)

Various bodies including the Law Society (represented by Herbert Smith), the Bar Council and the Institute of Chartered Accountants in England and Wales (ICAEW) have been granted permission to intervene in the Supreme Court. The appeal is due to be heard in November 2012.

Law Society to intervene in Prudential appeal to Supreme Court

On 13 April 2011 the Supreme Court granted Prudential permission to appeal against the Court of Appeal’s decision confirming that legal professional privilege does not extend to tax law advice given by accountants, or to the advice of any professionals other than qualified lawyers (i.e. solicitors, barristers or foreign lawyers): R (on the application of Prudential PLC & Anor) v Special Commissioner of Income Tax & Anor [2010] EWCA Civ 1094. Continue reading

The Supreme Court grants Prudential permission to appeal Court of Appeal judgment on legal advice privilege

In a decision handed down on 13 October 2010 the Court of Appeal confirmed that legal professional privilege (“LPP”) did not extend to advice on tax law given by accountants or anyone else other than legal advisors (ie qualified solicitors, barristers or foreign lawyers) – see post. On 13 April 2011 the Supreme Court granted Prudential permission to appeal, giving the appellant until 4 May 2011 to give notice to indicate whether it wishes to proceed with the appeal. Continue reading

Legal advice privilege: only for lawyers

The Court of Appeal has today handed down judgment confirming that legal advice privilege does not apply to any professional other than a qualified lawyer, i.e. a solicitor or barrister, or an appropriately qualified foreign lawyer: R (on the application of Prudential PLC & Anor) v Special Commissioner of Income Tax & Anor [2010] EWCA Civ 1094. In so doing, the court dismissed Prudential’s appeal against the High Court’s refusal to extend privilege to tax law advice given by accountants.

Herbert Smith represented the Law Society, which intervened in the appeal. The Court of Appeal judgment vindicates the Law Society’s position that privilege should not be extended beyond the legal profession and that any such extension would require primary legislation.

Key points:

  • The judgment confirms that legal advice privilege can be claimed only by clients of qualified lawyers. It is not available to clients of other professionals, regardless of whether the advice given is legal advice.
  • The Court of Appeal disagreed with comments made by the judge at first instance suggesting that legal advice privilege might be restricted or removed even as regards legal advice given by lawyers. Continue reading