Addlesee & Ors v Dentons Europe LLP

The dissolution of a company does not, while restoration remains legally possible, terminate legal professional privilege in documents formerly belonging to it. The privilege may vest in the Crown as bona vacantia, but the Crown’s position does not determine whether the privilege should be maintained. The court must protect the privilege where there remains a prospect that the company will be restored and the privilege revested in it. The privilege should be maintained unless and until there is no prospect of enforcement by the person entitled to it. This rule applies equally to solicitors and other holders of privileged material.

About 240 investors claimed against Dentons Europe LLP, formerly Salans LLP, alleging that its legal advice and apparent endorsement had enabled an investment scheme operated by Anabus Holdings Ltd. The company, incorporated in Cyprus, had been dissolved in June 2016. The claimants sought disclosure of the firm’s client files, contending that dissolution had ended the company’s legal professional privilege.

The parties agreed that the documents were relevant and would have remained privileged if the company had not been dissolved. The central issue was whether dissolution, the vesting of assets as bona vacantia, and the possibility of restoring the company to the register affected that privilege.

1. The application was dismissed. The judgment concerned only the effect of dissolution on the company’s legal professional privilege, not the iniquity exception.
2. The decision in Garvin Trustees Ltd v The Pensions Regulator [2014] UKUT B8 (TCC); [2015] 1 Pens LR 1 was binding. Its reasoning was not confined to cases in which privileged documents were held by persons other than solicitors. The policy underlying privilege prevented a principled distinction between solicitors and other holders of privileged material.
3. On dissolution, the company ceased to exist and could not itself assert the privilege. The relevant right nevertheless vested in the Crown as bona vacantia. The court rejected the proposed analysis that the privilege survived merely as an inchoate right capable of returning to existence on restoration.
4. The correct question was whether there remained a prospect that the company could be restored and the privilege revested in it. Where restoration remained legally possible, the court had to protect the privilege, even if restoration was practically remote. The privilege should be maintained unless and until there was no prospect of its enforcement by the person entitled to it.
5. The court rejected the argument that the privilege had passed to the Republic of Cyprus, or that Garvin Trustees applied only where the party entitled to privilege had declined to assert it. In the absence of contrary expert evidence, the position under Cypriot law was assumed to be the same as under English law. The Crown’s disclaimer did not waive the privilege.

First-instance decision. No prior or appellate decision is stated in the judgment.