On 13 October 2010, the Court of Appeal handed down judgment in R (on the application of Prudential plc & another) v Special Commissioner of Income Tax & another [2010] EWCA Civ 1094. The decision confirms that legal advice privilege does not apply to any professional other than a qualified lawyer, ie a solicitor or barrister, or an appropriately qualified foreign lawyer. The court dismissed Prudential’s appeal against the High Court’s refusal to extend privilege to tax law advice given by accountants.

In reaching its decision, the Court of Appeal held that it was bound by previous authority to find that privilege is restricted to members of the legal professions. However, it went on to say that, even if it were not so bound, it would conclude that it was not open to the court to hold that privilege applies outside the legal profession, except as a result of relevant statutory provisions.

Significantly, the Court of Appeal expressed its disagreement with comments made by the judge at first instance questioning whether privilege should be restricted or removed outside the litigation context.

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.