Not a surprising result, but a significant decision. PricewaterhouseCoopers (PwC) devised a tax avoidance scheme, which the Prudential group of companies implemented through a series of transactions. PwC had, as required under UK legislation, disclosed the scheme to Her Majesty’s Revenue and Customs, and a tax inspector later served notices on Prudential in order to obtain disclosure of specified documents. Prudential disclosed some documents, but asserted that legal advice privilege (what in Canada would be called solicitor-client privilege) protected the remainder. The tax inspector went up a level and obtained an order to disclose the documents withheld by the Pru, which applied for judicial review. Two levels of court held that the disputed documents would have been subject to privilege had the advice contained in them been provided by a member of the legal profession, but that ‘no such privilege extended to advice, even if identical in nature, provided by a professional person who was not a qualified lawyer’.
In the UK Supreme Court, Lord Neuberger gave the leading judgment for the majority. He held that while there were strong arguments in favour of extending the ambit of privilege, there was an equally strong case for confining the protection afforded by privilege to advice that is actually provided by lawyers. To extend privilege to non-lawyer professionals would entail uncertainties and unknown consequences. Merely saying (like the dissenting justices in this case) that it should be extended to professionals who ‘ordinarily’ provide advice of a legal nature does not provide sufficient clarity with respect to professionals like municipal planners, engineers, surveyors, architects or actuaries, who often have ‘considerable specialist legal expertise’ but who do not always give advice of a legal nature, and who are governed by their own codes and disciplinary procedures. Lord Neuberger thought any radical change in the longstanding policy to confine privilege to the legal profession was better left to parliament, especially in light of the changes to the legal profession itself under the Legal Services Act 2007 (which recognises that non-lawyers do provide legal advice and allows lawyers to work in professional firms with non-lawyers, but which does not extend privilege to non-lawyers). Lord Sumption and Lord Clarke dissented, on the grounds that English law has always taken a functional approach to privilege: its availability depends on the nature of the advice and the circumstances in which it is given, not the status of the adviser, as long as the advice is given in a professional context.
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