Case Law Update


14 October, 2010

The Court of Appeal has handed down judgment today in the case of Prudential v Special Commissioners, confirming the decision of the High Court last year that legal professional privilege only extends to communications between a client and their lawyer, and not to communications between a client and an accountant, even where the accountant is advising on legal matters, such as dealing with a tax appeal. Section 20 of the Taxes Management Act sets out what documents can be withheld, and the Court of Appeal decided that if that is what Parliament has specified can be withheld, then there is no scope to extend that class of documents by reference to legal privilege.

It remains to be seen whether the accountancy profession as a whole will lobby for a change in the law, something the Court signaled would be necessary for privilege to be extended to legal advice given by accountants. So for now accountants have to assume that communications with clients, unless falling within the excepted categories referred to in Section 20, are disclosable.

For further advice on privilege or to comment on this please email Robin Stephens


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