Solicitors asked to disclose information to the Serious Fraud Office (SFO) should do so even if the documents are confidential and relate to litigation conducted in the UK by a foreigner, the Court of Appeal has held.


City firm Macfarlanes acts in Marlwood Commercial Inc v Viktor Kozeny for British Virgin Islands companies which in 1998 entered agreements with Bahamas resident Viktor Kozeny to acquire companies with Azerbaijani oil interests.



They allege that they were induced to pay $180 million (£98 million) to Mr Kozeny and others by fraudulent misstatements.


In 2002, the New York District Attorney requested documents from the UK Home Office in relation to an investigation he is carrying out into Mr Kozeny's affairs.


In March and April last year, the SFO accordingly made requests for documents from the relevant partners: Charles Lloyd at Macfarlanes and Catherine Bailey at SJ Berwin, who acts for Mr Kozeny.


Macfarlanes sought permission from the court to comply with the SFO request. But Mr Kozeny challenged it, applying to the court seeking an order that Mr Lloyd and his own lawyer, Ms Bailey, should not comply.


It was argued that compliance with the SFO would be against public policy because the importance of maintaining confidential disclosure in litigation outweighed the importance of providing information in furtherance of investigations into serious fraud.


The application was rejected in February in the High Court, but Mr Kozeny appealed. Last week, the Court of Appeal refused to overturn the High Court judgment.


A spokeswoman for SJ Berwin said: 'We are instructed to petition the House of Lords for permission to appeal.'