JSC BTA Bank v Ablyazov et al [2014] EWHC 2788, Popplewell JIn a fascinating case, the High Court provided guidance on when legal professional privilege will not apply due to a party committing an
JSC BTA Bank v Ablyazov et al [2014] EWHC 2788, Popplewell J
In a fascinating case, the High Court provided guidance on when legal professional privilege will not apply due to a party committing an 'iniquity' by providing false information to their solicitors and abusing the benefits of privilege.
A has been involved in significant ongoing litigation regarding his alleged siphoning of $6 billion of assets from a bank of which he was chairman. These assets had been transferred to a large number of companies and individuals in order to conceal their whereabouts and ownership. Over the course of the proceedings he instructed three different firms of solicitors, all of whom were in possession of a huge volume of documents relating to his assets. The court held that A had attempted to deceive all three firms as to the extent of his assets and about companies of which he was the beneficial owner. The claimant bank sought disclosure of the documents in the solicitors' possession. The court had to decide whether the documents were privileged
In holding that they were not privileged, the judge cited a long (and occasionally ancient) line of authority to the effect that privilege does not exist where a party has used their solicitors (knowingly or unknowingly) to commit an 'iniquity'. The fact that privilege necessarily requires confidentiality was crucial to the judge's reasoning. Popplewell J summarised the position thus:
'In the 'ordinary run' of criminal cases the solicitor will be acting in the ordinary course of professional engagement, and the client doing no more than using him to provide the services inherent in the proper fulfilment of such engagement, even where in denying the crime the defendant puts forward what the jury finds to be a bogus defence.
But where in civil proceedings there is deception of the solicitors in order to use them as an instrument to perpetrate a substantial fraud on the other party and the court, that may well be indicative of a lack of confidentiality which is the essential prerequisite for the attachment of legal professional privilege. The deception of the solicitors, and therefore the abuse of the normal solicitor/client relationship, will often be the hallmark of iniquity which negates the privilege.'
That analysis was not inconsistent with rights under the ECHR and the European jurisprudence in relation to lawyer/client privilege. Where there was an abuse of the relationship, interference with Article 8 rights was justified where proportionate. Privilege in communications with lawyers also potentially engaged the right to a fair trial under Article 6, but it was self-evident that Article 6 rights could not be invoked to protect communications in furtherance of a purpose which was the very opposite of securing a fair trial.
The case is complex and is illustrative of the fact that in the 'ordinary run of things' clients may lie to their solicitors routinely in advancing a case and a defence. This is arguably an essential component of an adversarial system. On any given set of facts, it may not be easy to work out whether a party's conduct goes beyond this to being so egregious, misleading and abusive as to amount to an iniquity. It is not yet clear whether the judgment will be appealed.
In a fascinating case, the High Court provided guidance on when legal professional privilege will not apply due to a party committing an 'iniquity' by providing false information to their solicitors and abusing the benefits of privilege.
A has been involved in significant ongoing litigation regarding his alleged siphoning of $6 billion of assets from a bank of which he was chairman. These assets had been transferred to a large number of companies and individuals in order to conceal their whereabouts and ownership. Over the course of the proceedings he instructed three different firms of solicitors, all of whom were in possession of a huge volume of documents relating to his assets. The court held that A had attempted to deceive all three firms as to the extent of his assets and about companies of which he was the beneficial owner. The claimant bank sought disclosure of the documents in the solicitors' possession. The court had to decide whether the documents were privileged
In holding that they were not privileged, the judge cited a long (and occasionally ancient) line of authority to the effect that privilege does not exist where a party has used their solicitors (knowingly or unknowingly) to commit an 'iniquity'. The fact that privilege necessarily requires confidentiality was crucial to the judge's reasoning. Popplewell J summarised the position thus:
'In the 'ordinary run' of criminal cases the solicitor will be acting in the ordinary course of professional engagement, and the client doing no more than using him to provide the services inherent in the proper fulfilment of such engagement, even where in denying the crime the defendant puts forward what the jury finds to be a bogus defence.
But where in civil proceedings there is deception of the solicitors in order to use them as an instrument to perpetrate a substantial fraud on the other party and the court, that may well be indicative of a lack of confidentiality which is the essential prerequisite for the attachment of legal professional privilege. The deception of the solicitors, and therefore the abuse of the normal solicitor/client relationship, will often be the hallmark of iniquity which negates the privilege.'
That analysis was not inconsistent with rights under the ECHR and the European jurisprudence in relation to lawyer/client privilege. Where there was an abuse of the relationship, interference with Article 8 rights was justified where proportionate. Privilege in communications with lawyers also potentially engaged the right to a fair trial under Article 6, but it was self-evident that Article 6 rights could not be invoked to protect communications in furtherance of a purpose which was the very opposite of securing a fair trial.
The case is complex and is illustrative of the fact that in the 'ordinary run of things' clients may lie to their solicitors routinely in advancing a case and a defence. This is arguably an essential component of an adversarial system. On any given set of facts, it may not be easy to work out whether a party's conduct goes beyond this to being so egregious, misleading and abusive as to amount to an iniquity. It is not yet clear whether the judgment will be appealed.