Battle to allow accountants privilege reaches Supreme Court

THE HIGH-PROFILE case between insurance company Prudential and HM Revenue & Customs (HMRC) over an attempt to allow accountants to benefit from legal professional privilege (LPP) has reached the Supreme Court this week.

The move – the result of a tax dispute between Prudential and HMRC – comes after the Court of Appeal in 2010 rejected Prudential’s claim the advice of accountants in relation to tax law could be covered by LPP, which would protect it from being disclosed to third parties, reports Accountancy Age’s sister publication Legal Week

The case resumed in front of a seven-strong panel at the Supreme Court yesterday (5 November) and will run for three days.

Blackstone Chambers’ Lord Pannick QC is acting for Prudential, instructed by PwC.

James Eadie QC, also from Blackstone, is counsel for HMRC alongside the body’s in-house team.

The case has also attracted a lot of attention from the representative legal and accountancy bodies, with the Law Society, Bar Council and ICAEW all joining as interveners.

Herbert Smith Freehills is advising the Law Society led by dispute resolution partner Julian Copeman and head of tax planning and disputes Heather Gething, with Brick Court Chambers’ Sir Sydney Kentridge QC.

The trial was opened yesterday with an acknowledgement of the fact that it was Kentridge’s 90th birthday – a rare age to still be practising as a barrister.

Simmons & Simmons is acting for ICAEW with senior partner Colin Passmore fielding the team and Fountain Court’s Patricia Robertson QC as counsel, while Bankim Thanki QC from Fountain Court is instructed for the Bar Council.

The Legal Services Board and intellectual property body Association Internationale pour la Protection de la Propriété Intellectuelle have also submitted written opinions on the issue to the court.

Copeman said: “LPP is key to the justice system, particularly to enable clients to seek to obtain legal advice safe in the knowledge they are doing so in a privileged circumstance, and it is therefore very important that the boundaries are absolutely clear.

“The Court has given very clear backing to the importance of privilege in recent years, and this judgment will be fundamental in defining the boundaries of privilege.”

Accountancy Age will run a round-up of today’s proceedings