Latest Judgment Highlights Complexities Surrounding Fraud / Iniquity Exception

A recent judgment in The High Court has held that litigation privilege is removed when a client seeks advice from lawyers which is designed to deliberately assist a strategy of concealment and deceit.

In the high profile case of JSC Bank v Ablyazon and others [2014] EWHC 2788, The Hon. Mr Justice Popplewell said that the fraud/iniquity exception applied in this case as it appeared that the client was seeking advice in order protect his assets through deception.

Litigation privilege essentially protects confidential communications between a lawyer and their client and a third party. However, the fraud / iniquity exception means that this privilege is lost if a solicitor is consulted with in order to further aid a crime, fraud or other equivalent conduct. It applies even if the lawyer is unaware of the client’s intention, as was the situation in this case.

Mark Elder, Commercial Litigation Partner at Irwin Mitchell, said: