Iniquity exception to privilege requires prima facie case of fraud or crime – breach of a fundamental human right is not sufficient ~ Angela Liu, Herbert Smith Freehills – Litigation notes.
In a recent decision, the High Court declined to disapply legal professional privilege over documents alleged to reveal a breach of fundamental human rights, in the form of the claimant’s right to privacy: Holyoake v Candy and anor  EWHC 52 (QB).
It is an established principle that legal professional privilege may be disapplied where it is intended to act as a cloak for crime or fraud – this is known as the iniquity principle. In the present case, the court considered a novel argument that the principle should extend to documents evidencing a breach of fundamental human rights. The court rejected this argument, saying it would involve a “quite radical” extension of the iniquity principle. At least a prima facie case of fraudulent or criminal conduct is required to displace privilege where it would otherwise apply.
This decision serves as a reminder of the narrow scope of the iniquity principle and the robust standard that must be met before it is applied. It illustrates the unwillingness of the courts to encroach radically upon the protections conferred by legal professional privilege, which is itself a fundamental human right.
Angela Liu, an associate in our disputes team, considers the decision further below.
The case concerned the enforcement of subject access rights granted by the Data Protection Act 1998 (“DPA”). Section 7 of the DPA grants individuals the right to access their personal data, which is held by others, by making a subject access request (“SAR”). Information containing such data must be disclosed in response to a SAR unless this is not possible or would involve disproportionate effort. However, information which is protected by legal professional privilege need not be disclosed (the “LPP Exemption”).
The claimant, Mr Holyoake, made SARs to the defendants, Mr Candy and CPC, in the context of underlying proceedings between those parties in the Chancery Division (which are ongoing) and separate proceedings between Mr Holyoake and Mr Candy in the Queen’s Bench Division (which are presently stayed).
Mr Holyoake asserted that the responses to his SARs were inadequate. In particular, he claimed that the defendants had carried out inadequate searches for his personal data and that Mr Candy had illegitimately relied on the LPP Exemption in respect of certain documents within his control. Mr Candy claimed that these documents were protected by litigation privilege arising out of the proceedings in the Queen’s Bench Division.
Mr Holyoake argued that the LPP Exemption did not apply because (a) the documents related to underlying investigation and surveillance activities carried out over Mr Holyoake and his family which were tainted by criminal conduct, in the form of breaches of the DPA, and/or (b) those activities resulted in an unjustified interference with Mr Holyoake’s fundamental right to privacy. Mr Holyoake asked the court to inspect the documents itself to determine whether the LPP Exemption was validly claimed.
Two main issues fell to be determined, namely:
- Whether the defendants had carried out an adequate search in response to the SARs. That aspect is not considered further in this blog post.
- Whether Mr Candy was entitled to rely on the LPP Exemption.
The High Court (Mr Justice Warby) found that the LPP Exemption applied. The claimant’s reliance on the iniquity principle failed both on the facts and on the law.
The general rule is that legal professional privilege will only be displaced where there is at least a prima facie case of iniquity. A speculative case that the documents in question might involve or evidence wrongdoing would not be sufficient. Here, on the facts, there was no sufficient evidence of wrongdoing, whether based on alleged breaches of the DPA or alleged breaches of the claimant’s right to privacy.
Given that conclusion, Warby J said he could deal relatively shortly with the points of law. It would be a substantial and radical expansion of the iniquity principle to find that documents evidencing a breach of human rights, as opposed to crime or fraud, fell within its scope. Although the claimant emphasised the “fundamental” nature of the privacy rights at issue in this case, if the argument were accepted, the same principle would have to apply to other human rights. This would significantly erode the right to legal professional privilege – which was, after all, a fundamental human right in itself.
Warby J rejected the claimant’s alternative argument that the court should carry out a balancing exercise between the right to legal professional privilege and the competing human right (here the right to privacy). Although that would limit the extent to which the claimant’s argument involved an incursion into legal professional privilege, it would create a “new exception of uncertain ambit”. It would also be inconsistent with House of Lords authority. The House of Lords had rejected the notion that the availability of legal advice privilege might admit of exceptions, to be identified using a balancing exercise: R v Derby Magistrates Court, ex parte B  1 AC 487.
The judge also declined to inspect the documents for which the LPP Exemption was claimed. The established approach of the court was that inspection should only take place as a last resort, where there is credible evidence that those claiming privilege have misunderstood their duty or are not to be trusted with the decision, or where there is no reasonably practicable alternative. None of those conditions was satisfied here.