Jonathan Paul Thielmann & Ors. v Galina Besharova

Reliance on legal professional privilege does not ordinarily make litigation abusively unfair, even where relevant and highly probative documents are withheld. Abuse of process requires unfairness of a very high degree, ordinarily involving circumstances that make presenting or trying the case profoundly unjust or impossible. The court must assess all the circumstances together, including the nature of the privilege, the effect of any waiver, available procedural safeguards and proportionality. A limited waiver may raise issues of collateral waiver, further disclosure, adverse inferences or evidential insufficiency. Those issues do not generally justify striking out the claim. The court may also take account of a party’s ability to disavow reliance on documents disclosed under a limited waiver.

The respondent, the former wife of the deceased Boris Berezovsky, applied to strike out the trustees’ preference claim under the inherent jurisdiction. The claim concerned a £2.5 million payment allegedly made in preference to the respondent under Insolvency Act 1986, as modified for deceased insolvent estates.

The respondent argued that a fair trial was impossible because the trustees withheld relevant privileged documents concerning the value of the deceased’s claims and his motivation for making the payment. The trustees had waived privilege in six documents but maintained privilege over further material. The central issues were whether the withholding of privileged documents, alone or following the limited waiver, constituted an abuse of process.

1. Application dismissed. The preference claim was not an abuse of process and the application was not adjourned to trial.
2. The inherent jurisdiction to prevent abuse is not confined to breaches of procedural rules or fixed categories. It concerns the misuse and effect of the court’s process, assessed by reference to all the circumstances. Determining abuse is an exercise of judgment; selecting the remedy involves discretion.
3. A high degree of unfairness is required. A mere risk that a party may be disadvantaged, or the absence of relevant evidence, is insufficient. The authorities in which abuse had been found involved profound injustice, including an absolute or effectively complete inability to advance or defend the case.
4. Legal professional privilege is a fundamental and substantive right. It is absolute in nature, subject to recognised exceptions, and may withhold highly probative material without rendering the litigation process unfair. Reliance on privilege could theoretically contribute to abuse in extremely unusual circumstances, but this was not such a case.
5. The trustees had not created the privilege by their own procedural choices. The limited waiver did not alter the result. Any consequential unfairness could be addressed through an application based on collateral waiver, possible adverse inferences where legally available, or an argument that the claim was insufficiently evidenced. The trustees could also disavow reliance on the disclosed documents.
6. The respondent remained able to defend the claim at a listed four-day trial. The withheld documents had not been specified with sufficient precision, proportionality concerns remained, and the respondent herself relied on privilege in withholding potentially probative documents. The claim was therefore not manifestly unfair or abusive.