Legal privilege hangs in balance

David Corker denies that lawyers who resort to legal privilege are trying to pull off a confidence trick and defends this vital component of justice

One consequence of the Human Rights Act is that for the first time English law recognises a general right to privacy against intrusion by the state.

It seems ironic that a hitherto jealously guarded common law right to privacy, that of legal privilege, has come under sustained attack over the past 12 months.The protection of legally privileged communications against compulsory disclosure has always been an entrenched goal of public policy.

But state agents - especially in revenue protection and law enforcement - seem to believe that legal privilege is the refuge of the crooked and dishonest, and that - like those who transfer funds offshore - those who assert privilege as a means of denying information to investigators are abusing their rights to conceal otherwise actionable misconduct.While I do not argue that the existence of legal privilege is under imminent threat, it is being significantly eroded at the margins.

Lawyers need to recognise this, especially if it impacts upon the status of privilege generally.Last year's Office of Fair Trading report on the professions regarded privilege in the area of tax as an unfair competitive advantage enjoyed by lawyers over accountants.

It is of concern if privilege in mainstream areas of legal practice is to be so regarded, with consequent recommendations for its abolition or dilution.Where is this erosion occurring? I point to two recent instances; the judgment of Lord Justice Buxton in R (Morgan Grenfell & Co Ltd) v Special Commissioner [2001] 1 All ER 535 and section 50 of the Criminal Justice and Police Act 2001.In Morgan Grenfell, the Inland Revenue demanded access to counsel's instructions and advice to investigate the tax avoidance scheme the bank had marketed.

There was no suggestion here of tax evasion or other criminality.

The Revenue wanted access simply as part of its inquiry.

Lord Justice Buxton held that the Taxes Management Act had impliedly abrogated the privilege, so legal privilege could not be used to resist disclosure to the state.The new Act, rushed through Parliament just before the election, significantly increases pre-existing state search and seizure powers in criminal investigations.

The Act authorises the seizure of legally privileged material from the premises being raided if the investigators contend that it would not be 'reasonably practicable' to determine that it was privileged during the raid.

In any fraud investigation, where a premises with files of documents and hard drives are being searched, it now seems straightforward for the authorities, despite objection, to remove the contents of an entire office for later - and no doubt leisurely and careful - examination.Even worse, seized material later accepted as privileged can still be retained by the investigators if they hold that it would not be reasonably practicable to separate it from the non-privileged material.The Act does not permit the use of seized privileged material as evidence and, with an eye to Strasbourg, imposes various checks and creates remedies allowing a right of immediate access to a court.But there is a danger here that only lip-service will be paid to legal privilege as a fundamental right of privacy.

The mere examination of privileged material by an opposing party is tantamount to the destruction of the privilege.

This must especially apply in the context of a criminal investigation.Rights such as legal privilege will soon lose their vitality and reach if they are not cherished but instead, when sought to be exercised, are scorned as procedural devices being used by clever lawyers to obstruct legitimate law enforcement inquiries.

It seems that those would-be defenders of legal privilege, who regard it as a condition upon which the administration of justice as a whole rests, have a fight on their hands.David Corker is a solicitor specialising in criminal and regulatory work with Corker Binning, London