A Company and Others v Commissioner for the South African Revenue Services (16360/2013) [2014] ZAWCHC 33; 2014 (4) SA 549 (WCC); 76 SATC 321 (17 March 2014)

A Company and Others v Commissioner for the South African Revenue Services (16360/2013) [2014] ZAWCHC 33; 2014 (4) SA 549 (WCC); 76 SATC 321 (17 March 2014)

The court held that attorneys' fee notes are not privileged in their entirety by virtue of their nature. Privilege attaches only to those portions of the invoices that set out the substance of privileged communications or provide secondary evidence of the content of legal advice sought or given. Mere references to advice or to documents do not attract privilege unless they disclose the substance of the advice or the privileged communication. The applicants failed to provide sufficient contextual justification for most of their redactions, and only three passages in one invoice were found to be protected by legal advice privilege. The court rejected SARS's argument that privilege was...

Citation
[2014] ZAWCHC 33
Parties
Applicant: A Company; Applicant: Second Applicant; Applicant: Third Applicant; Respondent: Commissioner for the South African Revenue Services
Court
Western Cape High Court, Cape Town
Jurisdiction
South Africa
Judgment Date
17 March 2014
Case Number
16360/2013
Procedural Posture
Declaratory Application / Judgment After Hearing
Outcome
Application for declaratory relief granted only in respect of three specific redacted passages; otherwise dismissed. Respondent's interlocutory application dismissed. Each party to bear its own costs.
Judges
Binns-Ward
Legal Topics
Legal Professional Privilege, Tax Administration Act, Discovery and Disclosure, Waiver of Privilege
Tax Law Civil Procedure Legal Professional Privilege Tax Administration Act Discovery and Disclosure Waiver of Privilege

Case Brief

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Parties

A Company

Applicant

Second Applicant

Applicant

Third Applicant

Applicant

Commissioner for the South African Revenue Services

Respondent

Procedural Posture

Declaratory Application / Judgment After Hearing

Legal Issues

  1. 1 Whether legal advice privilege attaches to redacted portions of attorneys' fee notes provided to SARS under section 46 of the Tax Administration Act.
  2. 2 Whether attorneys' fee notes are privileged per se or only to the extent that they disclose the substance of legal advice sought or given.
  3. 3 Whether the applicants waived privilege by undertaking to provide the invoices.

Ratio Decidendi

The court held that attorneys' fee notes are not privileged in their entirety by virtue of their nature. Privilege attaches only to those portions of the invoices that set out the substance of privileged communications or provide secondary evidence of the content of legal advice sought or given. Mere references to advice or to documents do not attract privilege unless they disclose the substance of the advice or the privileged communication. The applicants failed to provide sufficient contextual justification for most of their redactions, and only three passages in one invoice were found to be protected by legal advice privilege. The court rejected SARS's argument that privilege was...

Court Disposition

Application for declaratory relief granted only in respect of three specific redacted passages; otherwise dismissed. Respondent's interlocutory application dismissed. Each party to bear its own costs.

Orders

  • The respondent's application to compel compliance with the rule 35(12) notice is dismissed.
  • It is declared that the following portions of the applicants' attorneys' tax invoice no. 6047890, dated 31 July 2008, are protected from disclosure by reason of legal advice privilege: (i) the redacted feenote item dated 21/04/2008 immediately below the item reading 'Perused the tracked sale of shares agreement...