Tax planning and compliance often involve collaboration between lawyers and accountants. Unless an accountant is the retaining client, they are often involved as third-party advisors whose participation in solicitor-client communications may impact the confidentiality of these communications. In such circumstances, concerns may arise with respect to maintaining solicitor-client privilege.
The Supreme Court of Canada, in the case of Solosky v The Queen, established the basic test for determining when solicitor-client privilege applies. The party asserting privilege must be able to demonstrate that the communication (a) has been made for the purpose of giving or receiving professional advice; (b) was made in confidence with no third-party present and with the intent it be kept confidential; and (c) was made within the scope of ordinary professional employment.
Two recent cases from the Tax Court of Canda (“TCC”) analyze the circumstances under which communications with a client’s accountant may be protected by solicitor-client privilege.