Clients who obtain advice from non-lawyers may not be able to prevent the disclosure of information given to advisors.
What is legal professional privilege?
LPP applies to confidential communications which pass between a
client and his lawyer and which have come into existence for the purpose
of giving or receiving legal advice. The application of privilege can
be both extended and restricted by statute. However, it currently
offers the advantage of not having to disclose communications subject to
it to any third party, for example, HM Revenue & Customs.
LPP comprises both legal advice privilege and litigation privilege. This case looks at legal advice privilege.
Therefore, if, for example, HM Revenue & Customs were to issue a
notice requiring the provision of certain papers relating to a
company’s or an individual’s tax affairs, then assuming that the papers
were subject to LPP, the documents would not have to be provided.
Why is privilege relevant to me?
The Court of Appeal confirmed that LPP applies only to qualified
lawyers and not to other professionals, for example, accountants who
provide tax advice. Therefore, if tax advice is sought from a lawyer
the client is protected from having to disclose qualifying
communications in which the client’s tax affairs are discussed. If the
same advice was provided by an accountant or other non-lawyer no such
protection from disclosure could be claimed.
It appears to be the case that where a law firm employs accountants
or other non-lawyers that any advice provided by such employees should
be sent to the client by a lawyer to ensure that LPP applies.
Commentary
This case highlights an advantage of obtaining tax advice from a
qualified lawyer. The maintenance of confidentiality in the
lawyer/client relationship enables clients to have greater comfort about
the security of personal and sensitive information they may wish to
remain that way.
Resources
R (on the application of Prudential plc and another) v Special Commissioner of Income Tax and another [2010] EWCA Civ 1094
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