Legal privilege protected in landmark decision

Legal professional privilege has been saved – for the moment. It took just over 15 minutes for the Law Lords to reach a decision on Three Rivers v Bank of England last Thursday, so it’s fair to assume that they were unanimous.

A lot turned on those 15 minutes. The Court of Appeal’s judgment in March held that communications between the Bank of England and Freshfields could be called as evidence in the BCCI liquidators’ case against the bank.

That decision threatened the right of clients to talk to their lawyers in absolute confidence, because only advice on black-letter law would be privileged. Any discussion of tactics or presentation could subsequently have been made public.

The decision could have totally undermined the role of solicitors as all-round advisers. With the proliferation of inquiries and sweeping new powers given to the regulators, lawyers have become pivotal in an increasingly authoritarian world. Even the Attorney General – who post-Iraq might have his own views on the importance of privilege attached to legal opinions – was worried about the implications.

Allied to this is the serious difficulty of defining who the client is.
Freshfields’ client was deemed to be the Bingham Inquiry Unit at the Bank of England, rather than the bank itself. It would be alarming if employees who may know the facts are not protected by privilege simply because they do not authorise payment of the legal bill. We’ll learn more on the definition of client when the judgment comes out in the autumn, but for all our sakes, let’s hope it’s not too narrow.

So it was a compelling few days in court, with the box office silks slugging it out. Pollock was against Sumption, while Kentridge attended on behalf of the Law Society, which was granted leave to intervene.

Pollock, in typically pugnacious form, argued that the Bingham Inquiry, and by extension all non-statutory inquiries, had no legal consequences. As you can imagine, this hardly went down very well with Lord Scott – the same Lord Scott who led the arms-to-Iraq inquiry in 1993. “Pollock got a hard time on that one,” says one onlooker.

And to end on an unapologetically liberal note: three cheers for Lords Brown, Carswell, Scott, Rogers, and Lady Hale for upholding a fundamental human right in the face of the increasingly powerful investigatory apparatus of the state. The pendulum is swinging back.