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14 Jun 2019 Regarding Sue Williamson’s National Technical Committee Chair’s Report ‘Protecting your clients’ rights to Legal Professional Privilege’

Editor’s note: Sue Williamson’s article on LPP can be found in TaxVine 21 (14 June 2019). 

MEMBER 146 writes: 

Dear Sue, 

Respectfully, I am a Chartered Accountant and a Chartered Tax Adviser. Although this was a good article to read, it would be good to see the Institute also deal with the question of the clients’ right to privilege of documents and communications with their accountant who, unless they are part of a big firm with an in-house legal counsel, are sitting out in the cold. 

Please, as a professional body dealing with the question of privilege, do not forget your member constituents who are accountants and Chartered Tax Advisers. 

MEMBER 147 writes: 

Thank you for Sue Williamson's comments on legal professional privilege. 

It would have been nice to see a pithy summary of what this client right means in practice. My guess is that many clients have a distorted view of its application and that overreach due to misunderstandings could be part of the problems experienced by the ATO. 

It is also relevant to note a broader context following the Hayne commission highlighting ethical issues. 

For example, Sue mentions that legal practitioners are officers of the Court and have a paramount duty to the administration of justice. Against this is a duty on lawyers to represent the best interests of their clients. In some cases, a lawyer can be aware that their client privately admits to an offence, but the lawyer is nevertheless not bound to reveal such admission to the courts. 

In the context of Hayne is the conflict that arises for an in-house counsel where the leadership of an organisation misbehaves against the best interest of stakeholders. To whom does the lawyer owe their duty; to duped stakeholders ultimately funding their remuneration, or to a board that is deceiving the stakeholders? The Law Council ethical code leaves such questions unanswered. 

While uncertainty exists around the ethical obligations of lawyers, it seems reasonable for the ATO to harbour suspicions around a lawyer's true fealty, including the application of LPP. 

MEMBER 148 writes: 

Dear Sue, 

With respect, I agree with the views you express about LPP, except the expression “cannot be underestimated” at the end of paragraph 5. 

This expression is often used in error. I believe the expression should be “cannot be OVER-estimated” or, better still, “cannot be overstated”. 

By not giving the matter the importance it deserves, it IS being understated. The truth is that it cannot be overstated. 

MEMBER 149 writes: 

Hi Sue, 

The High Court’s reserved judgment in Glencore v FCT in my expectation will become yet another nail in the coffin of the effective use of LPP in tax audits.


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