The House of Lords, said Lord Millet, upheld B's claim to privilege. The House 'expressly rejected the argument that legal profession privilege is an interest which falls to be balanced against competing public interests'. Once the privilege is said to exist it is absolute:
' ... Lord Taylor CJ said  1 AC 487, 508:
"the drawback to that approach is that once any exception to the general rule is allowed, the client's confidence is necessarily lost. The solicitor, instead of being able to tell his client that anything which the client might say would never in any circumstances be revealed without his consent, would have to qualify his assurance. He would have to tell the client that his confidence might be broken if in some future case the court were to hold that he no longer had 'any recognisable interest' in asserting his privilege. One can see at once that the purpose of the privilege would thereby be undermined."'
Exceptions prove the reason for a rule
The privilege applies to enable the adviser to provide legal advice in the course of a professional relationship which involves the provision of skilled legal advice (taken from Lord Sumption's definition in Prudential (above) at para ). But what are the exceptions to this? This may be a challenge for Parliament if any legislation is passed, for it may be that legal professional privilege will prove to be as easily defined according to its exceptions than to its main elements. The exceptions to LLP were reviewed by Fulford LJ in R v Brown  EWCA Crim 1328, but a simplified version of the position is set out in Prudential by Lord Neuberger:
' Where LLP attaches to a communication between a legal adviser and a client, the client is entitled to object to any third party seeing the communication for any purposes, unless (i) the client has agreed or waived its right, (ii) a statute provides that the privilege can be overriden, (iii) the document concerned was prepared for, or in connection with, a nefarious purpose, or (iv) one of a few miscellaneous exceptions applies (eg in a probate case where the validity of a will is contested.'
To this list can be added: (1) the very narrow band of exception identified by R v Brown (impropriety witnessed by a nurse in a prison interview room overrode LAP); and (2) where a lawyer learns of illegality such that s/he should report to appropriate authorities (W v Egdell  EWCA Civ 13,  Ch 359, eg proposed commission, or possible commission, of a criminal offence).
The main exception to LAP here is that the fraud or 'iniquity exception' was explained by Stephen J in R v Cox and Railton (1884) 14 QBD 153: that the confidentiality of advice privilege cannot be used to enable a client to obtain a lawyer's advice to further a dishonest intent. If documents show that a dishonest intent - eg tax evasion, or, say, plans to abduct a child - then privilege cannot apply. As Cox asserts, it did not apply in the first place, and the documents lose any confidential status they may have had.
But what is the position if confidentiality documents covered by LLP come to the attention of a third party, as might be the case if family lawyers handle Panama papers? The cat is out of the bag, but can it be put back? That was the question - whether or not privilege is lost - pondered by the Privy Council in B and Others v Auckland District Law Society (New Zealand)  UKPC 38. But in B v Auckland privilege had been conditionally waived in respect of particular documents and for limited purposes. To that extent, the documents were out of the bag. Once the condition no longer applied LLP revived, as Lord Millet in the Privy Council explained:
' ... The documents are privileged because they were created for the purpose of giving or receiving legal advice. If they are not produced voluntarily, production cannot be compelled. If they are produced voluntarily, the right to withhold production no longer attaches to them. In that sense the privilege may be said to be lost. but they are the same documents, and it is not appropriate to describe them as privileged. Their inherent characteristics are the same. The policy which protected them from unauthorised disclosure is the same. The cat is still a cat. It can be put back in the bag.'
Fraud and legal professional privilege
English courts are protective of LLP, as the Derby Magistrates case and more recent cases such as Berezovsky v Hine  EWCA CIv 1089 show. I do not know what the rules are about professional confidentiality in Panama, but if stolen or leaked documents which in England would be confidential and covered by LLP were to come before an English court, the justification for reference to them must be fraud. Fraud must be clear from the face of the papers and must be specifically pleaded (Medcalf v Weatherill  UKHL 27,  1 AC 120; Bar Standards Board, Guidance on pleading fraud). If the fraud allegation is based upon another fraud - the leaking or removal of what would be privileged documents at common law - the sand underlying the foundations of a spouse's set aside application becomes close to quick-sand, and not a sure foundation for a Sharland set-aside application.
The Court of Appeal looked askance at what they regarded as a breach of confidence in Imerman v Tchenguiz and Others  EWCA Civ 908,  2 FLR 814. How much more disapproving may they be if a case is based upon confidential - perhaps privileged - documents which have been leaked to the applicant, who has adopted any illegality in their removal save where the applicant has a cast-iron case that stolen or leaked documents prove fraud?
You can follow David Burrows on Twitter: @dbfamilylaw
The views expressed by contributing authors are not necessarily those of Family Law or Jordan Publishing.