Issue Summer 2014
TECBAR
The Newsletter of the Technology and Construction Bar Association
From the Chairman
Preparation of this message in continuing August heat
recalls an objection which was made to the proposed
creation of ‘Official Referees’ by the Judicature Bill of
1873. In the House of Commons Mr Henry Matthews QC
MP protested that this would create “… a subordinate
order of judge… to whom there was hardly any case which
might not be referred by a Judge, whether from indolence
or some of the many other motives that actuated even
serene judicial minds, and who were to have power to sit
in town or country; so that an official referee might take
a journey in the hot weather to Brighton, whither the
witnesses would have to follow him.”
Although this objection proved unpersuasive to the
legislature, it was 125 years before there was authoritative
recognition that the primary purpose of these new judicial
figures involved something more than the protection of
superior judges from the risk of tedium. Thus as late as
January 1990, in the course of opposing an amendment
to the Courts and Legal Services Bill that there should be
a new division of the High Court called the ‘Construction
Court’ with ‘Construction Judges’ - a proposal supported
by ORBA and the Law Society -, Lord Lane LCJ told the
House of Lords: “No one doubts that the official referees
do a wonderful job of work. They relieve the judges of
the High Court of a number of cases which are extremely
time consuming. That leaves the judges of the High
Court free to do work that is possibly more intricate and
more difficult.”
The gradual dismantlement of such lofty misdescriptions
began with the creation of the TCC in 1998. In June 2005
there followed the joint statement of Lord Woolf LCJ
and the Lord Chancellor with its acknowledgment that
disputes tried in the TCC include those “…of comparable
size and importance to general commercial litigation. TCC
judges try some of the most arduous and complex cases
which come before the civil courts”. The culmination was
in the ‘Jackson reforms’ and the jurisdictional equality
Informa Law
Summer 2014
TECBAR
Review
Issue Summer 2014
in association with
of the Rolls Building. It is a tribute to the quality of the
Court’s judges and practitioners over 140 years that ‘the
enormous condescension of history’ has finally been laid
to rest – and that, to date, the Court has not repaired to
Brighton in order to cool its heels.
Michael Soole Q.C., Chairman
From the Editor
What better way to be welcomed back to your desk after
the summer vacation than by the latest edition of the
TECBAR Review? In this issue, Felicity Dynes considers the
thorny issue of privilege and the iniquity exception to
it in the light of the recent decision in the long running
Ablyazov litigation. Whilst the iniquity exception is
perhaps not something that will trouble technology and
construction practitioners very often, an appreciation of
the boundaries of privilege is important for all lawyers
and Felicity offers a thought provoking and interesting
summary of this aspect of the law. Second, Peter Land
reviews the excellent ‘Construction Contract Variations’,
recently published by our friends at Informa and expertly
written by Michael Sergeant and Max Wieliczko of Holman
Fenwick Willan.
Mark Chennells, Editor
List of Contents
Legal professional privilege: a “fundamental human
right long established in the common law” or merely
a privilege? 2
Review of Construction Contract Variations – Michael
Sergeant, Max Wieliczko – Informa 8
1
 TECBAR
Legal professional privilege: a “fundamental human right long established in the
common law”1 or merely a privilege?
The development of the iniquity exception and BTA Bank v Ablyazov & Others [2014] EWHC 2788 (Comm)
Introduction
In the recent case in the ongoing proceedings brought by
the Kazakh national bank, BTA (“the Bank”) against Mukhtar
Ablyazov (“MA”), its former chairman, the issue of the scope of
legal professional privilege was addressed. This case provides
a reminder of the limits of the doctrine of legal professional
privilege and an example of the kind of circumstances in which
iniquity prevents a party from claiming privilege in respect of
communications with their legal representatives. This article
focuses on the development of the iniquity exception to legal
professional privilege, the jurisprudential basis for such an
exception and the practical application of this exception to the
doctrine in the light of Ablyazov.
Legal professional privilege
Privilege frequently confuses clients and lawyers alike. It
attaches not to documents or classes of documents per se, but
affords a person a right arising from his legal position to prevent
or limit another party’s access to or ability to rely on documents.
Legal professional privilege falls into two categories: legal
advice privilege and litigation privilege. Its existence can
be traced back to the sixteenth century. The rationale for its
development was explained by Lord Taylor CJ in R v Derby
Magistrates Court, ex parte B2 as follows:
“[…] a man must be able to consult his lawyer in confidence,
since otherwise he might hold back half the truth. The client
must be sure that what he tells his lawyer will never be
revealed without his consent. Legal professional privilege is
thus much more than an ordinary rule of evidence, limited
in its application to the facts of a particular case. It is a
fundamental condition on which the administration of justice
as a whole rests.”
Notwithstanding the above, where the administration of justice
is obstructed by a dishonest client, Popplewell J’s judgment in
the recent case of JSC BTA Bank v Ablyazov & Others3 reminds us
that a party may be denied the right to assert legal professional
privilege (the iniquity exception).
Development of the iniquity exception
The iniquity exception first appears in 19th century case law
and provides that where a party obtains advice or engages
1 Per Lord Hoffmann in R (on the application of Morgan Grenfell) v Special
Commissioner [2002] UKHL 21 at [8]
2 [1996] 1 AC 487 at 507C-E
3 [2014] EWHC 2788 (Comm)
2 Informa Law
Issue Summer 2014
representation in litigation in furtherance of a fraudulent or
iniquitous purpose, the right to claim legal professional privilege
in respect of client-lawyer communications does not apply. The
principle was first fully enunciated by Stephen J in the criminal
case of R v Cox and Railton4 which concerned a conspiracy to
defraud a judgment creditor. He explained the rationale behind
the exception as follows:5
“In order that the [legal professional privilege] rule may
apply there must be both professional confidence and
professional employment, but if the client has a criminal
object in view in his communications with his solicitor
one of these elements must necessarily be absent. The
client must either conspire with his solicitor or deceive
him. If his criminal object is avowed, the client does not
consult his adviser professionally, because it cannot be
the solicitor’s business to further any criminal object.
If the client does not avow his object he reposes no
confidence, for the state of facts, which is the foundation
of the supposed confidence, does not exist. The solicitor’s
advice is obtained by a fraud.”
In the more recent case of Kuwait Airways Corpn v Iraqi Airways
Co (No. 6)6 the doctrine was condensed by Longmore LJ to the
statement that “legal professional privilege […] does not attach
to communications between lawyer and client if the purpose of
the client in seeking advice is to further or facilitate a crime”
(emphasis added).
These explanations fit with long established logic that the
right to claim legal professional privilege is absolute and, if in
existence, cannot be displaced or eroded. In this jurisdiction
great importance has been placed on the inviolability of
legal professional privilege for the reasons stated by Lord
Taylor CJ in R v Derby Magistrates, ex parte B (cited above).
In other jurisdictions, such as Canada, such privilege is not
absolute and can be subordinated to other interests, such
as public safety. There have been indications in the English
courts that the absolute nature of privilege may not last.
For example, in the 2002 case of Medcalf v Mardell7 Lord
Hobhouse suggested that the incorporation of the ECHR into
domestic law may in future require a balancing approach to
the law of privilege:
“It may be that, as in the context of Articles 6 and 8 of the
European Convention on Human Rights, the privilege may not
always be absolute and a balancing exercise may sometimes
be necessary.”
4 (1884) 14 QBD 153
5 Ibid., at 168
6 [2005] EWCA Civ 286
7 [2002] 3 WLR 172
 Issue Summer 2014
However, at least for the moment, under English law, documents
are either privileged or they are not. There is no middle ground
or balancing of competing interests.
It is clear from authority and reiterated in Ablyazov8 that
“privilege is not prevented from attaching merely because the
solicitor is engaged to conduct litigation by putting forward an
account of events which the client knows to be untrue and
which therefore involves a deliberate strategy to mislead the
other party and the court, and to commit perjury”9. It is not
immediately apparent how pursuing a case with the intention of
committing the criminal offence of perjury differs from pursuing
a criminal object. The distinction is a fine one. Judicial guidance
provided so far has been unspecific, save that the iniquity
exception is said to apply in “circumstances which do not cover
the ordinary run of cases”.10
In Kuwait Airways the distinction was that “it cannot be
within the professional duty of a solicitor to assist in the
presentation of a bogus defence particularly with the assistance
of manufactured documents and the deliberate suppression
of others”.11 In Dubai Aluminium v Al-Alawi12 the claimants
secured a search and seizure order and a freezing order in
relation to the defendant’s assets, having procured information
about his bank accounts through their investigators who had
impersonated the defendant to do so, an offence under Swiss
law and English law. The claimants were required to disclose
reports and related documents relating to their investigations
of the defendant, even though these may have been produced
prior to or independent of the specific criminal/fraudulent
conduct. In Ablyazov, discussed below, the conduct extended to
perjury, forgery, contempt and dealing with assets in breach of
a freezing order.
Privilege cannot be excluded “where a communication is
made by a client to his legal adviser regarding the conduct of
his case, merely because such communication is untrue and
would, if acted upon, lead to the commission of the crime
of perjury in proceedings”.13 All the cases above go beyond
mere untruths. The passage cited suggests that privilege will
not attach only if the communication is acted upon, i.e. if
the criminal or fraudulent conduct is pursued. However, this
poses the difficulty that the decision as to privilege can only
be retrospective in these cases. If no iniquitous conduct is
pursued the communication must be privileged; if iniquitous
conduct is pursued then on the logic in R v Cox and Railton the
communication never attracted privilege in the first place.
One view is that legal professional privilege attaches to all
documents produced, but is negated by iniquity, rather than
8 [2014] EWHC 2788 (Comm) at [71]
9 R v Snaresbrook Crown Court, ex parte DPP [1988] QB 532; R v Central London
Criminal Court, ex parte Francis & Francis [1989] AC 346
10 Per Glidewell LJ in Snaresbrook [1988] QB 532 at 538
11 [2005] EWHC 367 (Comm) at [8]
12 [1999] 1 All ER 703
13 R v Central London Criminal Court, ex parte Francis & Francis [1989] AC 346 at
397
Informa Law
TECBAR
that never attaching at all. This circumvents the problem caused
by subsequent iniquitous activity affecting the ability of a party
to claim privilege in respect of earlier documentation related to
the same issue and disclosable as a result of the subsequent
iniquitous activity. It does however bring into question the
fiction of the inviolability of legal professional privilege. ‘Once
privileged, always privileged’ would not hold true.
An alternative view can be derived from consideration of
the definition of privilege as “the right to resist compulsory
disclosure of information”.14 The question of privilege
attaching need only be decided at the point in time when
disclosure is requested, rather than at the time the documents
are produced. This interpretation brings with it the difficulty
that a person cannot necessarily be sure of the privacy of
communications with his lawyer at the time they are made,
undermining the public policy reason for the existence of
privilege. The answer to this is perhaps that a person can be
sure, so long as no iniquitous purpose is pursued, as would be
the case in any event.
Although the public policy justification for the iniquity
exception is sound, it is submitted that the jurisprudential
basis for it is not. Thus far the conceptual difficulty has not
needed to be addressed and the Courts have had no problem
in deciding to which documents privilege does not attach as a
result of iniquity, without resolving the detailed reasoning for
this. Similarly, in Ablyazov the facts were sufficiently extreme to
allow the Judge to make a broad order for disclosure without
concern that the order would extend to privileged documents
not tarnished by iniquity. In all probability this issue will not
need to be addressed by the courts, but given an increasing
focus on the disclosability of documents held by solicitors and
the indication that the Courts may adopt a balancing exercise
approach to legal professional privilege in the interests of justice,
it is interesting to consider the legal basis for the exception and
the manner in which legal professional privilege may be eroded
in future.
Case summary
The background to the Ablyazov litigation is complex, but in
brief is as follows. From 2005 to early 2009 MA was the Chairman
of BTA Bank in Kazakhstan. In early 2009, amid concerns as to
the commercial viability of the Bank, the State of Kazakhstan
took control of the Bank and removed MA from his position. He
fled to the UK claiming asylum, and in August 2009 the Bank
commenced proceedings against him in the Commercial Court,
alleging that he had conspired to make fraudulent loans to
companies in which he was interested using funds of the Bank.
Related proceedings were also commenced in the Commercial
Court and in the Chancery Division, with 11 sets of proceedings
in total against MA and others for defrauding the Bank. The total
claimed stood at USD 6 billion.
14 Per Lord Millett in B v Auckland District Law Society [2003] 1 AC 736
3
 TECBAR
In August 2009 the Bank obtained an international freezing
order against assets held by MA up to the value of £175 million
(later amended in November 2012) (“the Freezing Order”). MA
was consequently required to provide disclosure of his assets.
Teare J ordered that he attend for cross-examination on the
basis that the disclosure provided had been “extraordinarily
inadequate”.15 He did so but was found to have lied in his
evidence. Receivers were appointed.
MA committed a number of breaches of the Freezing Order,
for example by granting security in favour of a Russian bank
over certain loan repayment rights and land in Moscow.16 In
May 2011 Briggs J found MA to be in contempt of court for
failing to comply with his disclosure obligations and on 27 June
2011 he sentenced MA to 18 months in prison for the contempt.
The Bank made an application to commit MA for contempt of
court, which was heard by Teare J. MA and his associate and
brother-in-law Mr Shalabayev gave evidence in which they lied
about MA’s assets. Teare J reserved judgment on the strength of
a “clear and unequivocal”17 undertaking by MA that he would
attend the handing down of judgment. He did not. A visit to
London Victoria and a budget coach trip later and MA had fled
the UK.
Notwithstanding his absence, MA defended the proceedings,
and was (and continues to be) represented by solicitors and
counsel. MA’s position was that the claims were borne out of
attempts by Nursultan Nazarbayev, president of Kazakhstan
since 1989, to eliminate him as a political opponent.
On 29 February 2012 Teare J made an order requiring MA to
give full and proper disclosure of his assets and surrender to
an officer of the Court, failing which he would be debarred from
defending. He failed to comply, but appealed the contempt
ruling and the imposition of the unless order. This brought
colourful and damning commentary from the Lord Justices of
Appeal.18 Toulson LJ (as he then was) described MA’s contempts
as “multiple, persistent and protracted, [they] have embraced
the offences of non-disclosure, lying in cross-examination, and
dealing with assets, and have been supported by the suborning
of false testimony and the forging of documents”.19 Maurice
Kay LJ added:20 “It is difficult to imagine a party to commercial
litigation who has acted with more cynicism, opportunism and
deviousness towards court orders than [MA]”.
Judgment was entered against MA in the Commercial Court
actions on 23 November 2012 and 19 March 2013. On 5 July
2013 Popplewell J ordered the Receivers to share non-privileged
information with the Bank.21 At the hearing MA was prevented
from making submissions to the Court given his status as a
“persistent and serial contemnor” and that he “no longer
15 [2009] EWHC 2833 (QB) at [5]
16 [2014] EWHC 2788 (Comm) at [12]
17 Ibid., at [24]
18 [2012] EWCA 1411
19 Ibid., at [106]
20 Ibid., at [202]
21 [2013] EWHC 1979 (Comm)
4 Informa Law
Issue Summer 2014
maintains even a pretence […] of being willing to abide by the
orders of the court”.
The applications for disclosure of privileged
documentation
Subsequently, the Bank lodged an application for disclosure. The
respondents to the application were (1) MA, (2) Mr Shalabayev,
(3) Clyde & Co, his initial solicitors in the litigation who
had also represented Mr Shalabayev and who had provided
corporate advice in relation to transactions alleged by the
Bank to constitute breaches of the Freezing Order, (4) his
subsequent solicitors, Stephenson Harwood, who represented
MA in the litigation, and (5) Addleshaw Goddard, who replaced
Stephenson Harwood as his legal representatives and continue
to represent MA.
The Bank sought disclosure by MA and Mr Shalabayev of
“documents relating to their assets which would attract legal
professional privilege unless falling within the iniquity exception
to such privilege, and which are currently held by the Third
to Fifth Respondents”. The Bank sought disclosure by the
respondent firms of solicitors of “all documents provided to
or produced for or by Clyde & Co LLP, Stephenson Harwood
LLP and/or Addleshaw Goddard LLP as remain within their sole
or joint control which (in whole or in part) concern or contain
information about (i) the current and/or former assets of
Messrs Ablyazov and/or Shalabayev and/or (ii) any prospective
or actual injunction [in respect of such assets] against Messrs
Ablyazov and/or Shalabayev”.
Issues in the case
The Bank argued that (i) LPP does not exist where the advice or
litigation is in furtherance of a fraud or crime or similar iniquity
and disclosure may be ordered where there is a strong prima
facie case that the iniquity exception applies; (ii) that there was
a strong prima facie case that the iniquity exception applies to
all documents held by the solicitors concerning the former or
current assets of MA and Mr Shalabayev and disclosure should
therefore be ordered. The argument for iniquity was based on
the proposition that MA and Mr Shalabayev had from the initial
retainer of Clyde & Co in February 2009 or from the date of the
Freezing Order conceived and pursued a strategy to lie to or
mislead the Bank and the Court about the extent and nature of
the assets held by MA as ultimate beneficial owner, to deal with
those assets in breach of court orders, to lie to or mislead the
Court about those dealings and otherwise seek to prejudice the
interests of the Bank by putting those assets beyond its reach.
The Bank’s case was that the solicitors were innocent agents in
MA and Mr Shalabayev’s strategy.
The unattractive case left to MA’s legal representatives
(Mr Shalabayev was not represented) was summarised by
Popplewell J as follows:22
22 [2014] EWHC 2788 (Comm) at [65]
 Issue Summer 2014
“(1) It is not sufficient to prevent privilege attaching that a
solicitor is used in the conduct of litigation to advance
a case on behalf of his client which the client knows to
be untrue and therefore involves perjury, or an attempt
to deceive the other party and the court, or to disobey
court orders. […] Although Mr Ablyazov’s conduct in this
respect may be seen as persistent and involving large
sums, there is no principled distinction between his
conduct and the ordinary run of cases.
(2) The Bank’s case involves an impermissibly sweeping
approach and fails to establish the necessary
requirement that the communication in question
must be “in furtherance” of the fraud. In doing so it is
inconsistent with both the common law authorities, and
the European jurisprudence on Articles 6 and 8 of ECHR.
What is required is that the abuse of the privileged
occasion itself operates to further the iniquitous
purpose. There must be a real causal connection
between the particular legal advice/assistance and the
wrong being committed. That is not established in this
case.”
A further three submissions were made, which, it was argued,
militated against the making of an order in the terms requested:
“(3) Disclosure should not be granted because Mr Ablyazov
invokes the privilege against self incrimination.
(4) Disclosure should not be granted as a matter of discretion,
because it is a vast and pointless fishing expedition. The
Bank has failed to make out a case that there is any
prospect of responsive material of any value in addition
to that which the Bank currently holds, alternatively any
prospect which justifies the expensive, time consuming
and intrusive nature of the search exercise. Moreover
the exercise can only be undertaken if paid for by
Mr Ablyazov who will not pay; the court will not act in
vain. For similar reasons the invasion of Mr Ablyazov’s
ECHR rights is not necessary or proportionate.
(5) The interests of others must be protected where there is
joint privilege or common interest privilege.”
The respondent law firms took a neutral stance on disclosure,
save for submissions made in respect of the practical
implementation of such an order.
The Court’s decision
Expression of the iniquity exception
Popplewell J considered the rationale of the iniquity exception
and where the line is to be drawn between the ‘ordinary run of
cases’ and iniquity. He said:23
“The answer lies, in my view, in a focus on three aspects
of legal professional privilege and the iniquity exception.
The first is that legal professional privilege attaches to
23 Ibid., at [76]
Informa Law
TECBAR
communications between solicitor and client which are
confidential. The quality of confidence is a prerequisite to
the privilege, because it is the protection of such confidence
which forms the bedrock of the rationale for the privilege
as essential to the administration of justice. Secondly,
communications made in furtherance of an iniquitous purpose
negate the necessary condition of confidentiality. It is this
which prevents legal professional privilege from attaching to
communications for such purpose. Thirdly, the reason that
communications in furtherance of iniquity lack the necessary
quality of confidentiality is that communications can only
attract the confidence if they are made in the ordinary
course of professional engagement of a solicitor. It is the
absence or abuse of the normal relationship which arises
where a solicitor is rendering a service falling within the
ordinary course of engagement which negates the necessary
confidentiality, and therefore the privilege. […]”
Strong prima facie case of iniquity
Popplewell J held that there was a very strong prima facie case
that MA was “bent on a strategy of concealment and deceit in
relation to his assets which would involve perjury, forgery and
contempt”24 and that Mr Shalabayev had embarked on conduct
of a similar nature and quality, albeit not as egregious.25 This was
therefore a case in which the iniquity exception would apply.
Documents to which the iniquity exception would apply
The Judge made clear that not all communications would fail to
attract privilege:26
“The iniquity does not touch, for example, the entirety of
the work concerned with the defence of the claims on the
merits. The negation of legal professional privilege is confined
to communications which can be said to be in furtherance of
the iniquitous strategy.”
He also addressed the submissions on behalf of MA that where
a document was produced partly for the iniquitous purpose
and partly in the ordinary and legitimate preparation of MA’s
defence, the ‘dominant purpose’ of the document should
be considered. The Judge dismissed this argument and held
that, the iniquitous purpose removes the confidentiality, and
therefore any document tarnished by the iniquitous purpose
becomes disclosable regardless of any dual purpose.
Privilege against self-incrimination
The privilege against self-incrimination is a common law
right that has been enshrined in statute. Section 14(1) of the
Civil Evidence Act 1968 codifies the “right of a person in any
legal proceedings other than criminal proceedings to refuse
24 Ibid., at [98]
25 Ibid., at [100]
26 Ibid., at [102]
5
 TECBAR
to answer any question or produce any document or thing
if to do so would tend to expose that person to proceedings
for an offence or for the recovery of a penalty”. Popplewell J
emphasised that the privilege against self-incrimination only
applies in relation to the danger of criminal proceedings in part
of the United Kingdom (it is at the court’s discretion whether
to allow it in relation to other jurisdictions). MA had sought to
invoke the privilege in relation to the whole of the disclosure
in respect of potential proceedings in England, Russia, Ukraine
and Kazakhstan.
The Judge decided that MA could not avail himself of the
privilege in order to avoid disclosure. He reiterated his view,
expressed in earlier proceedings in Ablyazov in relation
to a Garim Zharimbetov, that “it has been established by
authorities that the privilege against self-incrimination does
not extend to provide a person with protection against the
risk of incriminating himself by the provision of a document
or documents which come into existence independently of any
order, statute or other instrument of law which compelled their
production”, i.e. “it is limited to statements or material which
is brought into existence in consequence of the compulsion of
the Court”.27 The Judge refused to accept the submission on
behalf of MA that this was an erroneous interpretation of the
authorities, or, in the alternative, that the documents falling
within the iniquity exception were produced in consequence
of the orders of the Court and are therefore protected by
the privilege.
Discretion
The disclosure sought by the Bank represents an enormous task
for the respondent law firms. It was submitted on the part of
MA and Stephenson Harwood that such an exercise should not
be undertaken where it was unlikely that the documents would
shed any further light on the extent of the assets (given that,
had the documents provided to solicitors included details of any
assets which were not known to the Bank, they would have had
to be disclosed pursuant to the Freezing Order).
Although the Judge recognised that the disclosure exercise
would be extensive, lengthy and expensive, he considered
that it was proportionate given the likelihood of discovery of
information directly related to the assets or that would assist in
enforcement of the judgments and the judgment sums of almost
USD 4 billion which had not been satisfied. He also dismissed
MA’s argument that the order should not be made because MA
will be required to pay for it and will not do so and the court
should not act in vain. Popplewell J considered that the order
should nonetheless be made in the interests of justice and that
MA may in future be forced to change his mind or the Bank may
decide to fund it.
27 [2012] EWHC 2784 (Comm) at [72]; [2014] EWHC 2788 (Comm) at [115]
6 Informa Law
Issue Summer 2014
Joint and common interest privilege
The Judge considered that joint privilege or common interest
privilege in the documents was not a reason not to make an
order for disclosure; the protection of that privilege was simply
a matter to be considered in the practical implementation of
any order made. The parties in respect of whom privilege might
apply were companies related to MA’s dealings and the Judge
went further in deciding that there was a prima facie case they
were tarnished by the iniquity and therefore privilege would
not attach.
The order
The order made was for disclosure of all communications
concerning or containing information about current or
former assets.28 The decision in Ablyazov represents an
uncharacteristically broad result, perhaps due to the Court’s
frustration with the “persistent and serial” contempts
committed by MA. The implementation of the order made will
doubtless be a hugely time-consuming and complicated process
and it remains unclear how it is to be funded without payment
from MA. It remains to be seen whether and to what extent the
order will be successful in allowing the Bank to enforce.
Practical effect of the decision and the
iniquity exception
In practical terms, the iniquity exception is unlikely to give
rise to any (successful) application unless and until there is
a judgment in which a fraudulent or iniquitous purpose or
action on the part of a party is decided in unambiguous terms
to have been intended or to have occurred (as in Ablyazov and
Kuwait Airways). The decision in Ablyazov sheds little further
light on the distinction to be made between the ordinary run
of cases and those where the iniquity exception will apply; it
does however provide a useful example of the extreme nature
of the conduct required for a court to rule that legal professional
privilege does not attach to communications between a client
and their lawyer.
Increasingly, law firms are the focus of disclosure applications
where the client is beyond reach.29 Although it is only in very rare
cases that the iniquity exception will apply, legal representatives
should be alive to the risks that applications for disclosure of
documents or information could be made against them.
Such applications may be a useful tool in enforcement where
large judgment sums remain unpaid by disingenuous opponents.
In cases such as Ablyazov there is unlikely to be any simple
route to enforcement of judgments, but as MA awaits a retrial in
28 [2014] EWHC 2788 (Comm) at [103]
29 E.g. SRJ v Person(s) Unknown [2014] EWHC 2293 (QB); JSC BTA Bank v
Solodchenko (No 3) [2011] EWHC 2163 (ch); JSC BTA Bank v Ablyazov [2012]
EWCA Civ 1551
Continued on p8
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 TECBAR
Continued from page 6
France in relation to extradition requests by Ukraine and Russia
it is clear that the English Courts have refused to accept defeat
and continue to assist the successful claimant Bank in seeking
to recover its judgment debts. In Popplewell J’s words:30
“It is a fundamental and legitimate aim of a democratic
society to see that its judicial process is respected rather
than perverted, that its system of justice is rendered effective
30 [2014] EWHC 2788 (Comm) at [95]
Review of Construction Contract Variations – Michael Sergeant, Max Wieliczko – Informa
Variety’s the very spice of life,
That gives it all its flavour. We have run
Through ev’ry change that fancy at the loom
Exhausted has had genius to supply
And studious of mutation still, discard
A real elegance a little used
For monstrous novelty and strange disguise.
The Task, William Cowper, 1785
Practitioners are likely to be familiar with the distinction
between the variation of and the instruction of variations
under a construction contract. Whilst this book addresses all
mechanisms by which the work carried out under a construction
contract may be altered and the consequences of such alteration
for both the employer and contractor, the main focus is the
operation of express contractual mechanisms by which the
works to be undertaken by the contractor can be changed. As
the authors identify in their preface, it is a subject that is dealt
with in 20 pages by Keating and 70 pages in Hudson. This work
extends its treatment to more than three times those works
combined plus one chapter devoted to mechanisms by which
the work carried out may be changed other than by a contractual
variation provision, including variation of the contract, waiver of
contractual obligations and restitutionary claims for work done
outside the contract.
The book addresses its subject matter with a logical
structure addressing the three main aspects of the analysis
of any potential variation dispute. First, it addresses matters
of interpretation of the underlying contract (including the
Readers are invited to submit material by email to be considered for possible
publication. This may consist of correspondence, short articles or case notes,
news of forthcoming cases or events, book reviews, or other matters of interest
to members of TECBAR or SCL.
ISSN 1472 0078
© Informa UK Limited and TECBAR 2014
Editor: Mark Chennells
8 Informa Law
Issue Summer 2014
rather than undermined, and that the orders of its courts
are obeyed rather than thwarted, in civil cases as well as
criminal.”
It remains to be seen whether this approach will result in an
erosion of the inviolability of privilege, but Ablyazov arguably
points in this direction.
Felicity Dynes, Atkin Chambers
scope of works and specification) providing guidance on the
identification of the contractor’s original obligations necessary
to determine if the work in question is a variation at all. It
also considers the interpretation of the variation provision
itself to determine the extent of and limits to the employer’s
power of variation. Secondly, the authors address the variation
instruction including necessary formalities and questions of
authority. Finally the book addresses the consequences of a
variation including the contractor’s entitlement to money and
time, considering valuation approaches and processes and
the extent to which valuations can be reviewed or re-opened.
Throughout, the authors have sought to provide practical
examples of the numerous circumstances in which questions of
variation may arise on a construction project, readily accessible
through the detailed contents list which sets out every sub-
headed section of the text. There are references to examples
relating to several standard form contracts at various points
in the text; in any subsequent edition the authors may wish
to consider including a comparative analysis of the variation
provisions of the main standard forms providing quick access
to cases by reference to the relevant standard form. As may
be expected, the book includes wide citation of authority and
whilst in the main addressing the position under English law,
there is also citation of Commonwealth and USA authorities.
Helpfully, whether provided in support of key propositions or by
way of illustration of particular circumstances, cases are briefly
summarised and key passages of judgments quoted.
Peter Land, Atkin Chambers
Correspondence should be addressed to: mchennells@atkinchambers.com
or Mark Chennells, TECBAR Review Editor, Atkin Chambers, 1 Atkin Building,
Gray’s Inn, London, WC1R 5AT. DX 1033 Chancery Lane.
Tel 020 7404 0102. Fax 020 7404 7456.
If you do not wish to receive the TECBAR Review
please notify the Editor.
Published by Informa UK Limited.