In this article we explain a recent case this summer related to the misuse of private information and allegations of fraud, dishonesty and interference.
On the 10th of July 2026, Richards J handed down the judgment in Bourlakova v Anufriev and others [2026] EWHC 1747 (Ch), dismissing the sixth, seventh and eighth defendants’ (henceforth described as the “Applicants” as per the wording of the judgment) application “for declarations, disclosure and information on affidavit that relate to communications with private investigators” that the claimants (the Bourlakovas) “have instructed in connection with this dispute” (para 1 of judgment). The basis of the decision turns on the point of the claimants’ alleged iniquity. The judge held that the iniquity exception does not apply merely because one side holds the other’s confidential information.
Background
The parties are engaged in an ongoing dispute regarding who is entitled to the assets in excess of US$3 billion, left by wealthy Russian businessman, Mr Oleg Bourlakov, who died in 2021. Proceedings commenced in 2020, with “all parties alleging fraud, dishonesty and interference” (para 12). Two of the defendants have since launched a counterclaim against the Bourlakovas “relating to breach of confidence, misuse of private information and breach of data protection legislation” (para 13).
Issue
The Applicants argued that legal professional privilege should not apply to the instructions the claimants had given to enquiry agents. The Applicants’ case was that the claimants had acquired the information improperly and iniquitously, meaning the ‘iniquity exception’ should apply. The court had to consider whether the conduct of the Applicants was sufficiently improper, and where the boundaries lie, to engage this exception.
Richards J identified four alleged iniquities: covert recordings taken in the family home, instructing investigators CT Group, instructing a separate review counsel for the privileged material and instructing a second firm to eavesdrop on a conversation.
Held
- None of the alleged iniquities were established.
- The court rejected the Applicants’ argument that the behaviour was sufficient to engage the iniquity exception.
- The iniquity exception is not limited to cases involving fraud or dishonesty but includes other forms of underhand conduct.
- Application of the iniquity exception is dependent on the state of mind of the inquirer.
Details
The Applicants argued that engaging in a process of gaining the other party’s confidential information without their consent is inherently iniquitous, regardless of the mental state of the party engaging in the process. The court dismissed this, asserting that the claimants’ behaviour was not iniquitous because they, and their representatives, believed their investigations to be conducted lawfully (para 176, referring to the CT Group’s investigations). The court’s reasoning was, were gaining confidential information without consent inherently iniquitous, there would be “a chilling effect on the ability of claimants to obtain evidence in cases of suspected fraud” (para 168). Richards J reasoned that a claimant will “very seldom be able to show the iniquity is present until trial and will need to obtain documentary evidence to succeed at trial” should the allegation be true, in which case a defendant “might be expected not to volunteer information and indeed positively to hide it.”
However, the court recognised that the iniquity exception is not limited to fraud or dishonesty (paras 22 and 174), meaning the threshold for challenging an assertion of iniquitous investigations remains high. The court held that the application of the iniquity exception turns on the “actions, beliefs and motivations” (para 168) of the claimants. Thus, the case demonstrates that the state of mind of the party doing the investigation is relevant to establishing whether the iniquity exception applies.
Finally, regarding the eavesdropping, Richards J asserted that while eavesdropping on a private conversation is “unattractive”, he was not satisfied that the Bourlakovas were “committing any criminal offence in connection with their eavesdropping on the Conversation” (para 192). Indeed, the judge rejected the Applicants’ argument that the instructions to eavesdrop were “part of a process of ‘privilege hunting’” (para 193) and therefore no iniquity was found as a result of the eavesdropping. Therefore, while iniquity is not limited to fraud or dishonesty, not all “unattractive” behaviour is necessarily iniquitous, as such is dependent on the inquirer’s state of mind (see paras 116–117).
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Disclaimer: This article provides general guidance only and does not constitute legal advice. Civil procedure rules and case law can change. Always seek professional legal advice tailored to your specific situation before acting.