The application of the Federal legislation encroaching on solicitor-client privilege has, in recent years, become a more significant issue for lawyers and their clients.  In that regard, a recent British Columbia Supreme Court decision has upheld the importance of solicitor-client privilege, as a fundamental aspect of the lawyer and client relationship.

In a September 2011 decision, the B.C. Supreme Court held that provisions of the federal Proceeds of Crime (Money Laundering) and Terrorist Financing Act and related regulations are constitutionally invalid to the extent that they apply to legal counsel and law firms. At issue was a government proposal to require lawyers to collect and maintain records on the identity of their clients when acting as financial intermediaries on behalf of clients.

The decision underscores the importance of solicitor-client privilege and confidence in our system of justice. It also serves to strengthen the role of self-regulation, recognizing that law societies are best situated to regulate the conduct of lawyers because they can do so in the public interest, while at the same time maintaining protections for solicitor-client privilege.

While it is highly likely that this issue will receive further judicial consideration, this decision is a very significant and positive one, upholding a basic legal right for the protection of client confidentiality privilege.