C v C

Legal advice privilege can attach to solicitor-client communications made during a conveyancing transaction, including the sale of registered land. The relevant question is whether the solicitor was acting as a lawyer in a legal context concerning the client’s rights, liabilities, obligations or remedies.

The fraud exception is broad and may include transactions intended to defeat financial-relief claims under section 37 of the Matrimonial Causes Act 1973. However, privilege will be displaced only on a clear and definite allegation supported by strong evidence establishing a prima facie case resting on solid grounds. Mere suspicion, conjecture or a fishing expedition is insufficient.

The judgment concerned a preliminary application in ancillary relief proceedings. The wife sought production of a conveyancing file held by solicitors acting for a Liechtenstein anstalt that owned the former matrimonial home and an adjoining property.

The anstalt claimed legal professional privilege over communications with its solicitors. The wife alleged that the properties had been sold secretly and that the transaction might have been structured to defeat her financial claims. The central issues were whether the conveyancing communications were privileged, whether the fraud exception applied, and whether the judge should inspect the documents.

1. Privilege in conveyancing communications. Communications between a solicitor and client in the course of a conveyancing transaction are capable of attracting legal advice privilege. Registered conveyancing remains technically complex and requires legal skill. The solicitor acts in a relevant legal context even where no express legal advice is requested or given, because the transaction involves the client’s private-law rights, liabilities, obligations and remedies. The court applied the approach in Balabel v Air India [1988] Ch 317 and the House of Lords’ reasoning in Three Rivers District Council v Governor and Company of the Bank of England (No 6) [2004] UKHL 48.
2. Fraud exception. The exception is not confined to criminal fraud or fraud in the narrow civil sense. A transaction within section 37 of the Matrimonial Causes Act 1973, entered into with the intention of defeating or frustrating a spouse’s financial-relief claim, is one to which privilege does not attach.
3. Required evidential threshold. The allegation must be made in clear and definite terms and must have a prima facie foundation. For an order disclosing privileged documents, the court must require strong evidence of fraud or dishonesty resting on solid grounds. Grave suspicion, rumour, assumption and conjecture do not satisfy that demanding threshold.
4. Application. The wife had not clearly alleged relevant fraud by the anstalt, had not adequately particularised the allegation, and had not produced sufficiently compelling evidence that the transaction was caught by section 37. The anstalt therefore established privilege over the relevant solicitor-client parts of the file.
5. Inspection by the court. Judicial inspection of documents claimed to be privileged is discretionary and should be exercised very sparingly. It must not become a surrogate fishing expedition or undermine the policy that privilege is, in principle, absolute. The judge declined to inspect the documents.
6. The application to go behind privilege was refused, at least for the time being. The court distinguished the different evidential contexts governing the earlier freezing injunction and the later attempt to invade privilege. Kimber v Brookman Solicitors [2004] 2 FLR 221 did not assist because its facts involved far more serious litigation misconduct.

First-instance decision in the High Court (Family Division). No appellate history was stated in the judgment.