In Sports Direct International plc v Financial Reporting Council  EWCA Civ 177, the Court of Appeal (CoA) has allowed an appeal, overturning a lower court’s decision that certain emails had to be disclosed to a regulator (the Financial Reporting Council).
In doing to the CoA has reaffirmed that privilege should not be regarded as abrogated by a statute except by express words or necessary implication. Applied to the present case, the CoA considered that its task was to look at the wording of the relevant statute to see whether Parliament intended to override legal professional privilege. Here the CoA found that the statute (Schedule 2 of the Statutory Auditors and Third Country Auditors Regulations 2016) was not intended to do so.
The CoA rejected the lower court’s view that the disclosure of emails to a regulator, solely for the purposes of its confidential investigation into a regulated person’s conduct, was not an infringement of any legal professional privilege.
The CoA did however uphold the lower court’s decision that it was not possible to claim legal advice privilege for a document which was not privileged in itself, merely because it was attached to a communication sent between a client and a lawyer for the purposes of obtaining legal advice. Applied to this case, the CoA therefore found that certain pre-existing documents had to be disclosed, even though they had been attached to privileged emails. This was even though when considered alone the documents would not have fallen within the ambit of the regulator’s request for disclosure (because they fell outside of the relevant date range and other criteria), because by being attached to emails which (though privileged) were within that ambit, the attachments had been brought within the scope of the regulator’s request for disclosure.
Overall then this case gives reassurance that privileged documents will not have to be disclosed to a regulator, unless the statute granting the regulator’s powers is clearly intended to override privilege. However, care should be taken when sending non-privileged documents to a lawyer, since neither the document itself nor the fact that it has been sent to the lawyer will be privileged.