Anti-terrorism

Who should read this practice note?

Solicitors who are representing a person or people charged with or suspected of terrorism offences.

What is the issue?

If you are representing people charged with, or suspected of, serious crime, and in particular, in relation to suspected terrorism, the interests of your clients may conflict with the interests of the public as a whole.

There are three provisions of the Terrorism Act 2000 (TA 2000) that penalise, with the threat of imprisonment, persons who fail to disclose varying degrees of knowledge, belief or suspicion of the commission by others of terrorist offences.

This practice note explains the nature of your duty of confidentiality to a client, and how the anti-terrorism 'failure to disclose' offence provisions affect this duty.

Disclosure of information: duty

Under section 19 of TA 2000 it is an offence for a person not to "disclose to a constable as soon as reasonably practicable" their belief or suspicion, and the information on which it is based, that another person has committed an offence under sections 15 to 18 of the TA 2000, when that belief or suspicion is based on information coming to them in the course of a trade, profession, business or employment.

The offences referred to are:

• fund raising (section 15)
• use and possession of terrorist property (section 16)
• funding arrangements (section 17)
• money laundering (section 18)

Failure to disclose: regulated sector

Under section 21A TA 2000, if a person knows or suspects, or has reasonable grounds for knowing or suspecting, that another person has committed an offence under sections 15 to 18 of the TA 2000, and the information, or other matter upon which that knowledge, suspicion, reasonable belief is based, came to them during the course of business in the regulated sector, the person commits an offence if they do not disclose the information or other matter to a constable (or nominated officer) as soon as practicable after it comes to them.

The offence under section 21A is punishable on conviction on indictment by:

• imprisonment for up to five years  
• a fine
• both of the above

On summary conviction, the court can impose:

• a term of imprisonment up to a maximum of six months
• a fine not exceeding the statutory maximum
• both of the above

For full money laundering guidance on these provisions, reference should be made to our anti-money laundering guidance for the legal sector.

Information about acts of terrorism

Under section 38B TA 2000, if a person has information which he or she “knows or believes might be of material assistance in (a) preventing the commission by another person of an act of terrorism or, (b) in securing the apprehension, prosecution or conviction of another person, in the UK, for an offence involving the commission, preparation or instigation of an act of terrorism,” they commit an offence if they do not disclose the information to police as soon as reasonably practicable.

Conviction for the offence under section 38B carries a penalty on indictment of up to 10 years and/or a fine. For summary conviction, the court can impose a sentence of up to six months’ imprisonment and/or a fine up to the statutory maximum.

Conversely, it is an offence under section 39(2) if a person knows or has reasonable cause to suspect that there is or will be a terrorist investigation and discloses to another anything which is likely to prejudice the investigation or interferes with material which is likely to be relevant to that investigation.

It is also an offence under section 39(4) where a person knows or has reason to suspect that a disclosure has been or will be made under sections 19, 21B or 38B and:

• (a) discloses to another anything which is likely to prejudice an investigation resulting from the disclosure under that section, or
• (b) interferes with material which is likely to be relevant to an investigation resulting from disclosure under that section

There is a defence under section 39(5) if the person charged with the offence did not know or have reasonable cause to suspect that the disclosure or interference was likely to affect the investigation or that the person had a reasonable excuse for the disclosure or interference. However, the burden of proof for proving this lies on the person charged.

There is also provision at section 39(6) exempting professional legal advisers from the sub-sections 39(2) and (4) offences where the legal adviser makes the disclosure to their client or client’s representative in connection with the provision of legal advice. This will not be the case, however, if the disclosure is made with a view to furthering a criminal purpose.

Sub-sections 39(2) and (4) also do not apply where a professional legal adviser makes a disclosure to anyone for the purpose of actual or contemplated proceedings, unless the disclosure is made with a view to furthering a criminal purpose.

Under section 39(6A), sub-sections 39(2) and (4) do not apply where disclosure is within section 21D(2) or 3(a) (terrorist property tipping off) if the basis for the disclosure is information obtained in the course of business in the regulated sector.

These offences are punishable on conviction on indictment by a term of imprisonment of up to five years and or a fine.

For summary conviction, the penalty is a term of imprisonment for up to six months and a fine up to the statutory maximum, or both.

The solicitor's duty of client confidentiality

You are under a professional and legal obligation to keep the affairs of clients confidential and to ensure that all members of your staff do likewise.

See paragraphs 6.3 to 6.5 of the SRA Code of Conduct for Solicitors on confidentiality and disclosure for further details. Paragraph 6.3 states:

“You keep the affairs of current and former clients confidential unless disclosure is required or permitted by law or the client consents.”

This duty of confidence is fundamental to the fiduciary relationship that exists between solicitor and client. It extends to all matters divulged to a solicitor by a client, or on their behalf, from whatever source.

Overriding confidentiality

Confidentiality can be overridden in certain circumstances. For solicitors, the most relevant instances will arise when:

• a court order, or a statutory obligation, requires them to disclose by compulsion of law, or
• an exception to the duty of confidentiality arises from the public interest

The SRA guidance on confidentiality of client information provides more information on such circumstances.

Note that confidentiality in this context means confidential information which is not also privileged, for which different principles apply (see below).

Compulsion of law

A court has the power to compel the disclosure of confidential information held by a solicitor.

The most common examples of this are the statutory powers exercised by judges to compel production of confidential ("special procedure") material under Schedule 1 of the Police and Criminal Evidence Act 1984 (PACE) and, in certain circumstances, the issuing of witness summonses under the Criminal Procedure (Attendance of Witnesses) Act 1965.

A duty to the public to disclose

The circumstances in which you may make disclosure on grounds related to issues of public interest are very limited.

You may reveal confidential information only to the extent necessary to prevent the client, or a third party, committing a criminal act that is reasonably believed to be likely to result in serious bodily harm or a threat to the health, safety or wellbeing of another person, and, in cases of continuing or anticipated child abuse, if disclosure is in the public interest.

What communications are privileged?

Not everything that lawyers have a duty to keep confidential is privileged.

Only those confidential communications falling under either of the two heads of privilege – 'advice privilege' or 'litigation privilege' – are protected by LPP.

Who is a 'lawyer' for such purposes?

This includes solicitors and their employees, barristers, in-house lawyers, but does not include accountants, even if they give legal advice.

Advice privilege

Communications between a lawyer (acting in their capacity as a lawyer) and a client are privileged if they are confidential and for the dominant purpose of seeking legal advice from a lawyer or providing legal advice to a client. 

Legal advice privilege also applies where communications form part of a continuum that aims to keep client and lawyer informed so that advice may be given as required.

For example:

• the records of a conveyancing transaction itself were held not to be privileged in R v Crown Court at Inner London Sessions, ex p Baines & Baines (a firm) [1987] 3 All ER 2015
• a client account ledger maintained in relation to the client's moneys was held not to be privileged in Nationwide Building Society v Various Solicitors [1999] PNLR 53 because it was not created for the purpose of giving legal advice to a client but was an internal record maintained, in part, to discharge a solicitor's professional and disciplinary obligations
• an appointments diary or time record on an attendance note, time-sheet or fee record relating to a client was not a communication in the case of R v Manchester Crown Court, ex parte Rogers [1999] 1 WLR 832
• a solicitor's bill of costs was was found to be privileged in the circumstances in Chant v Brown (1852) 9 Hare 790 – but there is conflicting case law in this area
• notes of conversations, correspondence or meetings with opposing lawyers (as with notes of open court proceedings) are not privileged, as the content of the communication is not confidential: Parry v News Group Newspapers (1990) 140 New Law Journal 1719

Merely because a client is speaking or writing to their solicitor (or vice versa) does not make that communication privileged.

It is only those communications between the solicitor and the client relating to the matter in which the solicitor has been instructed for the dominant purpose of obtaining legal advice that will be privileged.

Such communications do not need to "contain advice on matters of law or construction, provided that they are directly related to the performance by the solicitor of his professional duty as legal adviser of his client" (Lord Carswell in Three Rivers DC v Governor of the Bank of England at paragraph 111).

Legal advice privilege also extends to documents which are not strictly communications per se but arise out of the lawyer-client relationship and are created for the dominant purpose of seeking or providing legal advice. Examples include a lawyer’s “working papers” or a background note prepared by a client.

Litigation privilege

The key distinction with litigation privilege as compared to legal advice privilege is that it is capable of applying to communications between a client or their lawyer and a third party.

Such a communication will attract litigation privilege only if:

• it is confidential
• at the time it is sent, litigation is underway or is in reasonable contemplation, and
• the purpose is to obtain information or advice for the sole or dominant purpose of the conduct of that litigation

(See WH Holding Ltd-v-E20 Stadium LLP [2018] EWCA Civ 2652.)

Note that the conduct of litigation includes deciding whether to settle or proceed with the litigation.

Where the document or communications contain advice or information which cannot be separated from non-privileged material or communications, or cannot be disclosed without revealing the privileged information or advice, these may be covered by litigation privilege.

Pre-existing documents

An original document, which is not brought into existence for either of these privileged purposes and so is not already privileged, does not acquire privileged status merely by being given to a lawyer for advice or otherwise for a privileged purpose.

Fraud or illegality – the crime/fraud (or iniquity) exception

It is proper for a lawyer to:

• advise a client on how to stay within the law and avoid committing a crime (Bullivant v Attorney-General of Victoria [1901] AC 196) or
• warn a client that proposed actions could attract prosecution (Butler v Board of Trade [1971] Ch 680 14; R v Cox & Railton (1884) 14 QBD 153), as long as this does not arise in circumstances that could amount to offences under sections 21D or 39 of the TA 2000

Such advice will be protected by privilege.

LPP does not, however, arise in respect of documents which themselves form part of a criminal or fraudulent act, or communications which further a criminal purpose or take place in order to obtain advice with the intention of carrying out an offence (R v Cox & Railton).

It is irrelevant whether or not the lawyer's aware that they're being used for that purpose (Banque Keyser Ullman v Skandia [1986] 1 Lloyds Rep 336).

It will usually be the investigators or prosecutors in a criminal case who claim that the crime-fraud exception applies.

A defence lawyer dealing with such a claim (or who suspects that they are unwittingly being involved by their client in a fraud) should recall that the courts require there to be sufficient evidence before LPP can be displaced.

Strong prima facie evidence may be required (O'Rourke v Darbishire [1920] AC 581; Various Claimants v News Group Newspapers [2021] EWHC 680 (Ch)) although the strength of evidence required has also been expressed in various other ways and at different levels (for instance, Kuwait Airways v Iraqi Airways [2005] EWCA Civ 286).

The lawyer may be well-advised to seek a declaration or order from the court, as in Finers v Miro and Governor and Company of the Bank of Scotland v A Ltd and others [2001] EWCA Civ 52.

The general 'crime/fraud exception' principle is restated in the Police and Criminal Evidence Act 1984 (PACE) at section 10(2), where items held with the intention of furthering a criminal purpose are declared not to be items subject to LPP.

It is also reflected in numerous other criminal statutes – including the Proceeds of Crime Act 2002 section 330 (failure to disclose) and section 342 (offences of prejudicing investigation).

The intention to further a criminal purpose need not be that of the client (or the lawyer).

It is sufficient that a third party intends the lawyer/client communication to be made with that purpose: for example, where the innocent client is being "used" by a third party (R v Central Criminal Court ex parte Francis & Francis [1989] 1 AC 346).

By statute

LPP is a fundamental human right. Parliament can legislate contrary to fundamental principles of human rights.

However, the House of Lords in Morgan Grenfell stressed that a parliamentary intention to override rights, such as LPP, must be expressly stated in the statute or appear by necessary implication. See also R v Secretary of State for the Home Department ex parte Simms [2000] 2 AC 115.

Public duty

Unlike the position in relation to confidential material (see above), there is no public interest exception to LPP.

It is therefore prima facie unlawful for a solicitor to disclose a communication if to do so would involve a breach of LPP.

Do sections 19 and 21A of the Terrorism Act 2000 override LPP?

Section 19(5) does not require disclosure by a “professional legal adviser” of either information which they obtain “in privileged circumstances”, or a belief or suspicion based on information which they obtain in “privileged circumstances”.

Section 21A (5) provides that a person does not commit an offence under the section if they have a reasonable excuse for not disclosing the information, or are a “professional legal adviser” and the information or other matter came to them in “privileged circumstances”.

Under both provisions, “privileged circumstances” are subject to the caveat that it will not cover communications in furtherance of a criminal purpose. A solicitor does not therefore, subject to the caveat, breach these sections of the TA 2000 if they fail to disclose information which has come to them in privileged circumstances.

Section 21A (5A) extends the exemption in section 21A (5) to any person employed by, or in partnership with, a professional legal adviser or relevant professional adviser to provide the adviser with assistance or support, so long as the information came to the person in connection with that help or support and in privileged circumstances.

Note that, under section 21A (6), the court must take into account whether the person followed any relevant guidance issued at the time by a supervisory or other appropriate body approved by the Treasury and published in such a way that it was likely to come to the attention of those most likely to be affected by it.

Under section 21A (8), information  “comes to” a professional legal adviser or other relevant professional adviser if it was given to the adviser by:

• client or the client’s representative in connection with the giving of legal advice to the client or representative
• person or that person’s representative in seeking legal advice, or
• person in connection with legal proceedings or in contemplation of legal proceedings

Section 21A (8) does not apply to information or matters which are communicated or given with a view to furthering a criminal purpose (section 21A (9)).

Protected disclosures

Section 21B provides that disclosure to a constable – or nominated officer in the relevant business – of information by regulated persons in the course of business in the relevant regulated business, that gives rise to reasonable suspicion that a relevant offence may be committed, is not to be taken to breach any restriction on the disclosure of information, however imposed.

Our view is that this does not apply to privileged information, although it may in appropriate circumstances apply to information that it is merely confidential.

Does section 38B of the Terrorism Act 2000 override LPP?

While there is no equivalent provision in this section to that relating to "professional legal advisers" as in sections 19 and 21A TA 2000, in order to override LPP the statute must do so expressly or by necessary implication.

No express words are used overriding LPP; therefore, LPP can only be overridden by section 38B if that is a necessary implication of the words used in section 38B.

What is meant by 'a necessary implication'?

Lord Millett expressed the test in B v Auckland District Law Society [2003] 3 WLR 859:

“A useful test is to write in the words 'not being privileged documents' and ask, not 'does that produce a reasonable result' or 'does it impede the statutory purpose for which production may be required?' but 'does that produce an inconsistency?' or 'does it stultify the statutory purpose?' The circumstances in which such a question would receive an affirmative answer would be rare.”

This provides helpful assistance in the absence of specific judicial interpretation of section 38B TA 2000.

It would seem unlikely that it could be successfully argued that the statutory purpose of section 38B would be stultified if it was to read (adopting the wording in the earlier sections and adapting Lord Millett's formula), “the person commits an offence if he does not disclose the information unless it was obtained in privileged circumstances as soon as reasonably practicable...”.

Further, as Lord Hoffman explained in ex parte Simms and another, “[i]n the absence of express language or necessary implications to the contrary, the courts therefore presume that even the most general words were intended to be subject to the basic rights of the individual”.

We therefore consider that LPP is not overridden by section 38B TA 2000 and that information of the kind referred to in the section, if received in privileged circumstances, cannot be disclosed without the authority of the client. A failure to disclose such privileged information should amount to a “reasonable excuse”.

It is crucial, however, that a solicitor, when in receipt of such information, should be absolutely satisfied that the information is privileged; for example, in relation to legal advice privilege, that the client's purpose in supplying that information has been for the obtaining of legal advice and it is directly related to the performance by the solicitor of their professional duty as the legal adviser of the client.

If it is not, then it is not protected by LPP. It will, however, remain confidential.

The only defence available to an offence under section 38B is that the person charged has a reasonable excuse for not making a disclosure. Is confidentiality a “reasonable excuse”?

There is a clear duty owed by the solicitor to the public to disclose confidential information to prevent the client, or a third party, committing a criminal act that is reasonably believed to be likely to result in serious bodily harm or one that will threaten the safety or wellbeing of another person.

The duty no longer applies after the criminal act has been carried out.

Since there is a public duty to disclose in such circumstances, it would seem likely that confidentiality would not amount to a reasonable excuse for non-disclosure under section 38B TA 2000, and that a solicitor prosecuted for failing to disclose such information would have no defence. 

In the absence of specific guidance, lawyers should ask themselves what other lawyers would reasonably do in these circumstances.

Before disclosing confidential client information, they should consider and carefully balance their justification for concluding that there is a public duty to disclose, the risk of harm to an individual if no disclosure is made, and the risk to themselves if the information on which any decision to disclose is based turns out to have been unreliable.

It is our view that the solicitor must disclose such confidential information, where there is a duty to the public to do so, as soon as reasonably practicable.