Timothy Brennan QC successful in Court of Appeal: no legal professional privilege available for accountants
The Court of Appeal has handed down judgment in R (Prudential plc) v Special Commissioner of Income Tax [2010] EWCA Civ 1094. Prudential had challenged, on judicial review, use by HM Revenue & Customs of its statutory information powers (at the time, contained in the Taxes Management Act 1970 s 20) to obtain information about advice given by accountants in connection with a tax avoidance scheme. Prudential claimed that the advice attracted legal professional privilege (LPP) since it would have been protected by LPP if it had been given by a solicitor or barrister.
In view of the general importance of the point to the professions, the Institute of Chartered Accountants in England and Wales, the Bar Council and the Law Society all intervened in the appeal and were separately represented.
Giving the main judgment dismissing the appeal, Lloyd LJ said that
“The court was favoured with advocacy of the highest quality on behalf of both parties and all three interveners, building on powerful written submissions, and drawing on a wide range of legal materials, including comparative material from other jurisdictions. …[T]he range (as well as the quality) of the submissions made and the extent of the materials put before us have assisted me greatly in coming to my conclusion.”
The Court decided that LPP did not apply, at common law, in relation to any professional other than a solicitor or a barrister, or an appropriately qualified foreign lawyer. It was bound by the earlier decision of the Court of Appeal in Wilden Pump Engineering Co v Fusfeld [1985] FSR 159 and in any event, even having regard to Article 8 of the European Convention on Human Rights, it was not open to the court to hold that LPP applied outside the legal profession; any other conclusion would not have been sufficiently clear and certain in its scope and application. Indeed, in the absence of definition as to who was entitled to describe himself as an “accountant” it would not even be possible to identify whose advice was so protected.
Timothy Brennan QC appeared for HM Revenue & Customs
A report on the case can be found in The Lawyer and The Law Society Gazette.
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