ICAEW makes shrewd move in legal privilege battle

by Kevin Reed

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06 Oct 2011

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GREAT TO SEE the ICAEW taking an aggressive, some might say patronising, tone in letting the Law Society know in no uncertain terms that it must not restrict the onset of multi-disciplinary practices (MDPs).

The Law Society, don't forget, is led by Des Hudson (pictured). I've always found him very amiable, feisty and determined. The ICAEW might agree - in part - with me, having received a bloodied nose from him as ICAS boss.

Back in 2005, with Des at the helm, ICAS enlisted Scottish first minister Jack McConnell to protest against the English institute's proposed change of name to the ICA.

But that's history, as much as ICAEW v Des Round Two would make for great stories.

Much more interesting is the subtext of the ICAEW's letter to the Law Society.

The institute has so far been thwarted in its efforts to extend legal professional privilege to tax advisors' clients. Lawyers will often use privilege as a USP to win tax clients ahead of accountants.

But it seems that allowing lawyers and accountants to work together in partnership will set off the next phase of the privilege battle. It seems there is concern that accountants will use MDPs as a backdoor for gaining privilege.

Whether this is true or not, pushing the society to water down any attempts to fend off lawyers and accountants working together is a smart move.

The Law Society will be on a sticky wicket if it goes against the intention of the Act by making it difficult for the two professions to work in MDPs. Let's face it, the two often work together as it is.

With the Joint Committee having already called for a review into how privilege would work in MDPs when the Act was at Bill stage, it's clear that the institute has some grounds for sticking to its guns.

It may have lost some fights, but an ICAEW rematch with Des Hudson might merely be an eliminator to take on the government for the title.

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