Scope of limited waiver of privilege considered in a summary judgment application (Mond v Insolvency Practitioners Association)

Dispute Resolution analysis: The IPA has failed in an application for summary judgment seeking summary disposal of a claim for declarations that privilege in certain documents had been retained in a complex disciplinary process. The judgment has considered in some detail the doctrine of limited waiver and extent to which such issues are suitable for summary determination.

Mond v Insolvency Practitioners Association [2023] EWHC 477 (Ch)

What are the practical implications of this case?

This judgment considers a number of authorities in relation to the doctrine of limited waiver of privilege. The consideration was in light of an application for summary judgment following a protracted and challenging set of disciplinary proceedings against an insolvency practitioner. The judgment highlights the difficulties associated with determining questions of limited waiver of privilege at a summary judgment hearing. The determination of such questions may potentially require detailed evidence and disclosure in relation to a wide range of issues relevant to whether privilege has been waived or retained. Practitioners should take care to assess whether the arguments in relation to privilege constitute a short point of law or construction suitable for summary determination (per Lewison J in Easyair Ltd v Opal Telecom Ltd [2009] EWHC 339 (Ch)) or whether the issues are better instead left for trial.

What was the background?

Mr Mond, an insolvency practitioner and chartered accountant licensed by the IPA. In May 2018, the Disciplinary Committee of the IPA upheld 3 complaints made against Mr Mond, relating to his role as supervisor of IVAs and the approval of the payment of referral fees to a company, DRSP. The Disciplinary Committee imposed a severe reprimand, a fine of £500,000 and a costs order of £208,369.51.  Mr Mond was represented by Counsel at the Disciplinary Committee. Mr Mond appealed to the IPA Appeals Committee and, after submitting substantive grounds of appeal, changed Counsel. He then applied to amend his notice of appeal to introduce a preliminary ground of appeal. That preliminary ground was that (a) his former Counsel had a serious conflict of interest and/or a real risk of a conflict and that this impaired his ability to represent Mr Mond before the Disciplinary Committee. The conflict related to fact Counsel had advised to a significant extent on the arrangements which formed the subject matter of the complaints. Mr Mond served a witness statement which exhibited a small amount of privileged material, disclosing that material on the basis that he was waiving privilege only for the purposes of the appeal and not to any other extent. The IPA sought disclosure from Mr Mond of all communications between him and Counsel, arguing that he could not cherry-pick the privileged material which he wished to disclose. Mr Mond provided that extended disclosure, contending again that he did so solely for the purpose of the appeal. The appeal was allowed by the Appeals Committee and the sanctions imposed were set aside. They ordered the costs order to stand, in light of criticisms made about the conduct of Mr Mond at the Disciplinary Committee. Mr Mond successfully judicially reviewed that decision on costs and negotiations commenced between Mr Mond and the IPA about how the issues remitted back to the Disciplinary Committee would be dealt with. Mr Mond argued that the limited basis of the disclosure of the privileged material had expired and that the IPA should destroy it, could not use it at the new Disciplinary Committee and should change its legal team. The IPA agreed to those conditions save that it sought to keep its same legal team. Mr Mond issued proceedings by way of Part 8 seeking declarations that he had not waived privilege in respect of the privileged material. The IPA defended that claim and sought summary judgment. The summary judgment application was heard in private.

What did the court decide?

There were two grounds put forward in support of the summary judgment application. (1) That Mr Mond stood no real prospect of success in showing that privilege has been maintained (“Ground 1”). (2) If Ground 1 fails, the granting the declarations sought by Mr Mond would in light of the undertakings given be of no practical utility and Mr Mond has no real prospect of arguing to the contrary (“Ground 2”). The IPA argued that Mr Mond’s conduct was not consistent with the maintenance of privilege. After considering a number of authorities, the Court focused in particular on the test of limited waiver at paragraph [48] of Scottish Lion Insurance Co Ltd v Goodrich Corporation [2011] SC 534. It concluded that there was room for serious argument, on the basis of that authority, that privilege had been maintained in the privileged material for the purposes of the second Disciplinary Committee hearing and that it was not appropriate to grant summary judgment in favour of the IPA. The matter should be decided on the basis of fuller argument and evidence than is available on a summary judgment application. This would permit further examination of factors such as (i) the precise context in which the disclosure was made, (ii) precisely how the privileged material was deployed in argument before the Appeals Committee, (iii) the likely extent of the relevance of the disclosure to the further Disciplinary Committee hearing and (iv) the nature of the inconsistency with the previous evidence given. Ground 2 was rejected more forcefully. The Court concluded that not only does Mr Mond have a reasonable prospect of showing that the declarations sought had practical utility, his arguments on practical utility were actually fairly strong. If privilege was retained, there was an argument that the IPA’s legal team should also cease to act going forwards. The summary judgment application, therefore, failed.

Case details

• Court: Business and Property Courts, Business List (ChD)
• Judge: Jonathan Hilliard KC (sitting as a Deputy High Court Judge)
• Date of judgment: 6 March 2023

Article by Phillip Patterson – first published by LexisNexis