The Court of Appeal has handed down an important judgment addressing a number of points of principle regarding the scope of legal professional privilege: Al Sadeq v Dechert LLP & Ors [2024] EWCA Civ 28.
The judgment arises out of a claim against English solicitors alleging misconduct in the course of an investigation into suspected frauds against a Gulf sovereign wealth fund.
The issues addressed in the judgment concern, among other things, the so-called ‘iniquity exception’ to privilege and the application of litigation privilege to cases where the party claiming privilege is not a party to the litigation in question.
As regards the iniquity exception, it has long been established that communications which are ‘part of or in furtherance of’ a crime, fraud or other serious wrongdoing cannot be subject to privilege (whether legal advice privilege or litigation privilege).
Within this established doctrine, the judgment establishes the following important points of principle:
- A party seeking to invoke the iniquity exception must usually establish on the balance of probabilities that the relevant iniquity was committed. This means that the existence of the iniquity must be more likely than not on the material available to the decision-maker, whether than be the party or legal adviser determining whether privilege applies or the Court on any challenge to a claim to privilege.
- A communication will be ‘part of’ an iniquity if it “reports on or reveals” the iniquity; provided that the communication took place in circumstances amounting to an abuse of the lawyer-client relationship. Whether a communication which ‘reports on or reveals’ an iniquity involves an abuse of the lawyer-client relationship is a fact-specific question.
As regards litigation privilege, the judgment establishes that it is not a pre-requisite for the party claiming privilege to be a party to the litigation in question. Provided that the litigation in question is adversarial in nature and the communication in question is made for the dominant purpose of use in relation to that litigation, then the privilege can apply.
The circumstances in which a non-party will satisfy this test are, as a matter of fact, likely to be rare. But examples might include victims of criminal offences creating documents in connection with criminal proceedings relating to the crime; or indemnity insurers creating documents in relation to proceedings against their insureds.
Sandy Phipps was instructed by Enyo Law for the respondent solicitors, led by Philip Edey KC and Luke Pearce KC.
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