This area of solicitor-client privilege has recently been considerably clarified. Lemos provides clear guidance on how courts will view liens in the context of bankruptcy and how a person`s privilege remains inviolable and a fundamental human right. An example where litigation privilege would apply is when a lawyer provides his client with a letter of notice of the likelihood of success of a claim because the client has received notice from an employee or former employee that he will file a claim in the Labour Court if the matter is not resolved to his satisfaction. Since this document was prepared for the sole purpose of providing legal advice in the context of planned litigation, this document would be classified as privileged and would benefit from the related protection. It is important to note that litigation privilege applies to any communication created for the purpose of initiating, avoiding, resolving or defending a dispute. However, the holder may waive this privilege if he can substantiate his case, although this may entail the risk that other relevant protected documents will also lose their protection. Permissions can also be inadvertently lifted, such as by transferring a protected document, sharing the information it contains, or giving a copy to someone else. In general, if permissions are lifted for a document in a document sequence, the remaining documents in that order that relate to a particular issue also lose protection. Mr Shlosberg requested that Dechert be ordered to stop working for Avonwick.

The action was based on the fact that Dechert was in possession and had examined a large number of documents which were either privileged and confidential for Mr Shlosberg or jointly privileged and confidential for Mr Shlosberg and Webinvest. The Court also confirmed that “privileges are a fundamental human right and that the court does not have the power to order a bankrupt, let alone a third party, to waive the privilege in any document.” He continues: “In my opinion, it is a question of competence and not discretion. But if I am wrong, I think that, in principle, a very convincing case would have to be made before the court properly orders a bankrupt to waive solicitor-client privilege with respect to documents. As I am currently recommending, I find this difficult. to consider all the circumstances in which it would be appropriate to make such an order. The administrators had access to documents obtained from Christos Lemos` former lawyers in the course of their work as civil servants. The question arose as to whether the documents were protected by professional secrecy, which belonged to Christos Lemos alone or jointly with his wife. The trustees considered that a number of these documents could be useful as evidence for the purposes of Joanna Lemos` section 423 proceedings. Accordingly, insolvency practitioners have sought advice regarding the use of these documents: In addition, there is a number of case law, starting with Crescent Farm (Sidcup) Sports v. Sterling Offices, which declare that solicitor-client privilege exists in favour of a successor in title, so that the legal privilege of a bankrupt in the documents is transferred to the TIBs.

who can then “use” these privileged documents for purposes that benefit the bankruptcy estate. The defendants pointed out that under the 1986 Bankruptcy Act, the trustees had acquired ownership of all of Mr. Shlosberg`s assets at the time of the bankruptcy (subject to certain specific exceptions unrelated to the current purpose, such as clothing and other personal effects). The term “property” is broadly defined in the 1986 Act and, in the respondents` view, should include both the privilege attached to the documents in question and the documents themselves. Nor do these decisions appear to reflect the changing regulatory landscape surrounding fraud, where fraud prevention and investigation are essential, and where the use of solicitor-client privilege to withhold information is not considered acceptable in certain circumstances. For example: legal privilege applies to communications between a lawyer and his or her client, which are created exclusively or primarily for the purpose of providing legal advice or obtaining legal advice. (iii) Dechert had thoroughly examined the privileged documents and had done so deliberately; The Shlosberg judgment was not the first case in which this point was highlighted, as the fundamental principle goes back to several landmark cases, such as: R v Derby Magistrates Court, ex p. B [1], Special Commissioner and another, Ex P Morgan Grenfell [2] State Secretary at the Ministry of the Interior, Ex Parte Simms [3]. It will be interesting to see if the unsuccessful candidates in Lemos will appeal and if other powers of the Court of Appeal will come on this important point. In the meantime, insolvency practitioners must continue to treat very carefully all documents that have come into their possession, that are protected by the bankrupt debtor, in the absence of a clear waiver of the bankruptcy debtor`s privilege. The other interesting point that arises from this case concerns the multiple mandates adopted by Dechert. While it is neither unusual nor necessarily reprehensible for a single law firm to act on behalf of both the insolvency practitioner and a major creditor of the insolvent person or company, this should be treated with caution.

The investigation should consider whether separate teams should be active for each client and whether information barriers should be erected in the event that the interests of an insolvency estate and its principal creditor diverge. The fact that Dechert did not take these steps appears to have strongly incriminated Judge Arnold in ordering him to cease acting for Avonwick. “. [I am] satisfied that it [Crescent Farm] does not apply in the case of a transfer of ownership to a trustee; and to the extent that Judge Peter Gibson answered in the affirmative, the Re Königsberg case is wrongly decided.