The Facts  

The question which arose in this case was whether, following receipt of a statutory notice from an inspector of taxes to produce documents in connection with its tax affairs, a company was entitled to refuse to comply on the ground that the documents were covered by LAP, in circumstances where the legal advice was given by accountants in relation to a tax avoidance scheme.

PricewaterhouseCoopers (PwC) devised a marketed tax avoidance scheme, which was adapted for the benefit of the Prudential group, and implemented through a series of transactions.  The Inspector of Taxes subsequently looked into the details of the transactions, and to that end served notices asking Prudential to disclose a number of specified documents.  Prudential refused to disclose certain documents on the ground that they were entitled to claim LAP in respect of them. 

The Inspector obtained authorisation from the Special Commissioners to require Prudential to disclose the disputed documents.  Prudential made an application for judicial review challenging the validity of the notices on the ground that they sought disclosure of documents which related to the seeking (by Prudential) and the giving (by PwC) of legal advice in connection with the transactions, which were excluded from the disclosure requirement by virtue of LAP.

The High Court rejected Prudential’s application on the ground that, even though the disputed documents would have been protected by LAP if the advice had been sought from a qualified lawyer, no such privilege extended to advice, even if identical in nature, provided by a professional person who was not a qualified lawyer.  The High Court decision was upheld by the Court of Appeal. 

Prudential then appealed to the Supreme Court. 

The Decision

By a majority of five to two, Prudential's appeal was dismissed. The Court held that LAP should not be extended to communications in connection with advice given by professional people other than lawyers, even where that advice is legal advice which the professional person is qualified to give.

The majority held that:

  1. The ambit of LAP currently has clearly defined limits, and in consequence, the advantages of clarity and certainty.  To declare that LAP should be applied in any case where legal advice is given by a member of a "profession [which] ordinarily includes the giving of legal advice" would give rise to a significant risk of uncertainty.
  2. The courts were not best placed to assess whether there are good reasons of public policy for extending the ambit of LAP, and that the matter should be left to Parliament to consider.  
  3. Parliament had previously legislated on the assumption that LAP only applies to advice given by qualified lawyers.


This ruling is consistent with current Irish law which similarly recognises legal advice privilege as being confined to communications passing between a client and their lawyers, in the course of a legal relationship.

This decision confirms that legal advice privilege does not apply to expert advice given by accountants or any other professionals who may have considerable specialist legal expertise, such as architects, surveyors, engineers, pensions advisers etc.  Accordingly, clients should exercise caution when instructing non-lawyer third parties, as any communications may be disclosable in litigation or to regulatory authorities.

It is worth noting that there are two categories of Legal Professional Privilege: (1) LAP and (2) Litigation Privilege.  This case was concerned with LAP only.  Litigation Privilege protects from disclosure confidential communications between either a client or his/her lawyer and third parties, where the dominant purpose is to prepare for actual or reasonably apprehended litigation. 

Case: R (on the application of Prudential Plc and another) v Special Commissioner of Income Tax and another [2013] UKSC 1, 23 January 2013