Ford v Financial Services Authority & Anor

Judicial review relief remains discretionary where a decision-maker has used legally privileged material. The court must assess the material’s significance, the nature of the error, the effect of removing it, and the public interest. A decision need not be quashed where the privileged material is peripheral, the decision remains coherent after redaction, and the outcome would realistically have been the same.

Where privileged material has reached the wrong hands, appropriate relief may include best endeavours to retrieve, destroy, delete or redact it. An order excluding investigators or legal advisers from continuing work requires a real risk of prejudice and must be proportionate, particularly where the investigation is near completion.

The claimant challenged the Financial Services Authority’s use and dissemination of material over which he and others were found to have joint interest legal professional privilege. The substantive judgment of 11 October 2011, [2011] EWHC 2583 (Admin), granted declarations concerning two documents.

The remedies hearing concerned whether the Warning Notices should be quashed, whether the privileged material should be destroyed or redacted, whether FSA staff and Regulatory Decisions Committee advisers should be excluded from the investigation, and what disclosure or protective steps were required. A related protective warning notice was also challenged.

1. Warning Notices. The use of privileged material was an error, but it was not properly characterised as taking an irrelevant matter into account for Wednesbury purposes. The closer analogy was action based in part on inadmissible evidence. The material formed only a modest and peripheral part of a detailed case, and was substantially parasitic upon non-privileged Grant Thornton material.
2. The court distinguished Berkeley v Secretary of State for the Environment and another [2001] 2 A.C. 603. This was not an excess of power case. The Warning Notices remained coherent and powerful without the privileged references, and it was extremely difficult to imagine that they would not have been issued or that the proposed sanction would realistically have differed. The Warning Notices were therefore not quashed. The privileged material was to be redacted and the regulatory process continued on the redacted documents.
3. Destruction and redaction. Legal professional privilege is a fundamental right and not merely a rule of evidence. The FSA was required to use its best endeavours to retrieve and destroy hard copies, delete electronic copies of the privileged documents, and delete or redact copies of the SIR, Warning Notices and other documents referring to or quoting the privileged material. Copies could be retained securely for the litigation and audit purposes.
4. Continuing involvement. Guidance from private-law cases concerning lawyers who receive privileged material was useful but was not a straitjacket. The relevant considerations included the circumstances of acquisition, the extent of review, potential prejudice, the stage of the proceedings, safeguards, proportionality and the public interest. The privileged material added little, created no real continuing advantage, and the investigation was substantially complete. Excluding all investigators and advisers would therefore be disproportionate. That relief was refused, although the FSA agreed that the original RDC members would take no further part.
5. Disclosure and dissemination. Applying the necessity test in Tweed v Parades Commission for Northern Ireland [2007] 1 A.C. 650, disclosure was unnecessary where there was no reason to suppose that anything was amiss. The FSA was nevertheless ordered to ask recipients to return or destroy the material, refrain from using or disseminating it, and provide responses to the claimant’s solicitors.
6. The protective warning notice became irrelevant once the original Warning Notices were preserved. Permission to apply for judicial review of it was refused.

The judgment continued the remedies stage following the High Court’s substantive judgment of 11 October 2011, [2011] EWHC 2583 (Admin). The present court refused to quash the Warning Notices and refused permission concerning the protective warning notice.