Privilege in financial remedy proceedings

Insight

15.10.2025

The subject of privilege is extensive. This article therefore summarises the two types of privilege that might be available in financial remedy cases – legal professional privilege and without prejudice privilege, and highlights some potential traps.

Legal professional privilege

Legal professional privilege allows clients to resist disclosure of certain 'privileged' material. Its purpose is to enable a client to make full disclosure to their legal adviser for the purposes of seeking legal advice without fear that anything said by them or to them may then be disclosed against their will.

Privilege can apply to both oral and written communications, and to documents in any form, whether hard copy or electronic.

Not all communications are protected. If the communication is merely business advice, it may lack the relevant legal context for privilege to apply. In addition, where legal advice is sought or given for the purpose of effecting fraud or 'iniquity' it will not be privileged.

There are two main types of privilege:

Legal advice privilege covers:

confidential communications (written or oral) between a lawyer and client, entered into
for the purpose of giving or obtaining legal advice. Where the solicitor is acting not as the client's legal adviser but as the client's 'person of business', there will be no legal professional privilege (AAZ v BBZ and others [2016] EWHC 3349).

Litigation privilege covers:

confidential communications where, at the time of the communication, litigation was in reasonable prospect; and
the dominant purpose of the communication was for litigation.

This can include communications (including reports) with someone other than a lawyer if they come into existence with the dominant purpose of obtaining legal advice in existing or anticipated proceedings.

Confidentiality

Both types of privilege require that the relevant document must be confidential. Confidentiality will not apply if, for example, the information contained in the document is in the public domain.

Waiving legal professional privilege

A party to litigation can waive privilege, either deliberately or inadvertently. If reference is made to the content of legal advice given or received, or importantly, instructions given to a legal advisor, privilege may be considered to have been waived.

It is important to be aware that, whether it was deliberate or not, waiver of privilege may give rise to an obligation to produce further associated privileged documents. If a party wishes to rely on material which would otherwise be privileged, the other party and the court must have an opportunity of satisfying themselves that what the party has chosen to release from privilege represents the whole of the material relevant to the issue in question. To allow an individual item to be plucked out of context would be to risk injustice through its real weight or meaning being misunderstood. A party cannot seek to gain an advantage in litigation by 'cherry picking' part of a document and placing it before the court and withholding the remainder. This would be unfair. However, even if privilege is waived, this does not necessarily result in the entire file being made disclosable. Only documents relevant to the issue in question should be disclosed.

The point is illustrated by the decision of AG v VD (Legal Privilege) [2020] EWHC 1847 (Fam), [2020] 2 FLR 1248 in which the wife claimed that a petition that was filed in 2017 did not reflect her instructions. The husband sought disclosure of the file from the wife's previous advisors arguing that she was relying on privileged material, and that it would be unfair to him if he was left unable to challenge her statement without having sight of the contemporaneous notes taken by the advisors and/or correspondence or other communications between them. Cohen J found that the wife had waived privilege. She was expressly challenging what her lawyers had quoted her instructions to be. It would not be fair for the husband to be put in the position where he could not challenge that statement by reference to what were likely to be contemporaneous notes, emails or other communications. It made no difference whether the communications in question had been from solicitor to client, or from client to solicitors by way of instruction.

Without prejudice, FDR and mediation privilege

Any indication given by the FDR judge and any offers made during the FDR cannot be referred to openly going forwards. The reason for this is that, in order for the FDR to be effective, parties must approach the occasion openly and without reserve, and non-disclosure of the content is therefore an essential pre-requisite for fruitful settlement discussions (LS v PS (Q Company (a litigation lender) intervening) [2021] EWHC 3508). Evidence of anything said or of any admission made in the course of an FDR appointment will not be admissible in evidence, except at the trial of a person for an offence committed at the appointment or in very exceptional circumstances relating to child protection (Re D (Minors) (Conciliation: Disclosure of Information) [1993] 1 FLR 932).

Similarly, without prejudice privilege attaches to correspondence and discussions between the parties and their advisors relating to genuine attempts to reach a settlement, in order to encourage parties to speak freely. Such correspondence should be labelled 'without prejudice', but correspondence that is labelled 'without prejudice' that is not sent in the context of genuine attempts to reach an agreement may not be considered to be privileged.

Likewise, whilst financial disclosure given in mediation is 'open' and therefore disclosable, all settlement discussions that take place within the mediation process are privileged.

Waiving without prejudice privilege

Without prejudice correspondence attracts joint privilege, which means that it can only be waived if both parties agree to do so. However, care must be taken to avoid waiving privilege inadvertently as the effect of waiving privilege in relation to part will generally be to waive privilege in relation to the whole chain of communication.

As can be seen, it is crucial to have an understanding of what documents will attract privilege, and for care to be taken not to waive privilege unintentionally. Further, even where a deliberate decision is made to waive privilege over a document, it is important to be mindful of the rules of 'collateral waiver' which may impose an obligation to disclose other related documents so as to prevent the court/opponent from being given only a partial picture.