Supreme Court's stark reminder: Court of Appeal decision that legal advice privilege does not apply to legal advice given by a professional other than a lawyer
On 23 January 2013, the Supreme Court handed down its judgment in the case of R (on the application of Prudential plc and another) v Special Commissioner of Income Tax (2013) UKSC 1, confirming the Court of Appeal decision that legal advice privilege does not apply to legal advice given by a professional other than a lawyer.
Implications for the real estate sector
Even though this particular case relates to tax advice provided by accountants, the Supreme Court stressed that the principle is wider, and so affects all professionals who, though they are not lawyers, provide legal advice in the course of their business.
Professionals in the real estate sector often provide legal advice to clients in their particular area of expertise, including:
- rights of light surveyors' advice in relation to potential developments
- architects' and engineers' advice on building regulations
- planning consultants' advice on planning regulations
- valuers' advice on dilapidations liability and section 18 valuations
- agents' advice in relation to break notice and/or lease renewal tactics
- party wall surveyors' advice in relation to party wall issues
- surveyors' advice in relation to service charges
It is not always possible for all advice to come from a legal professional, so it is worth taking precautions to reduce the possibility of having to disclose information to the other side, if the matter becomes contentious.
General precautions include:
- Property professionals should avoid providing legal advice or commenting on it in writing. Best practice is to discuss via telephone or face-to-face. It is important to stress that the professional and/or client can still be cross-examined at trial on such oral communications.
- Legal advice is best provided by lawyers to ensure that it remains privileged
- Clients' concerns and queries for advice must be disclosed in litigation unless they form part of a request for legal advice to a lawyer. Therefore, clients and property professionals should avoid expressing their views on the strengths and weaknesses of the position in writing, unless it is part of a specific request for legal advice.